{"id":171251,"date":"2020-05-28T07:45:02","date_gmt":"2020-05-28T11:45:02","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=171251"},"modified":"2020-05-28T07:11:06","modified_gmt":"2020-05-28T11:11:06","slug":"m2-velocity-collapses-could-a-bottom-in-capital-velocity-be-setting-up","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/05\/m2-velocity-collapses-could-a-bottom-in-capital-velocity-be-setting-up\/","title":{"rendered":"M2 Velocity Collapses – Could A Bottom In Capital Velocity Be Setting Up?"},"content":{"rendered":"
May 28, 2020<\/div>
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By TheTechnicalTraders<\/u><\/a>\u00a0<\/strong><\/p>\n

– M2 Velocity is the measurement of capital circulating within the economy.\u00a0 The faster capital circulates within the economy, the more that capital is being deployed within the economy to create output and opportunities for economic growth.\u00a0 When M2 Velocity contracts, capital is being deployed in investments or assets that prevent that capital from further circulation within the economy \u2013 thus preventing further output and opportunity growth features.<\/p>\n

The decline in M2 Velocity over the past 10+ years has been dramatic and consistent with the dramatic new zero US Federal Reserve interest rates initiated since just after the 2008 credit crisis market collapse.\u00a0 It appears to our researchers that these extended periods of zero interest rates deflate the capability of money circulating throughout the economy and engaging in real growth opportunities for investment and capital inflation.<\/p>\n

It also suggests that the US Federal Reserve, while attempting to support the US economy and global markets, maybe destructively engaging in policy that removes the capital function from the markets in a systematic process.\u00a0 Eventually, something will break related to M2 Velocity and\/or the global economy.\u00a0 As more capital pours into less liquid assets and\/or broader investment funds and Bonds, this process ties capital up into assets that take investment away from Main Street and the lower\/middle class.\u00a0 There is less capital available to support the ground level economy as more and more capital ends up buried in longer-term investment assets.<\/p>\n

Before we continue, be sure to\u00a0opt-in to our free market trend signals<\/strong> <\/em>before closing this page, so you don\u2019t miss our next special report!<\/em><\/p>\n

VELOCITY OF M2 MONEY STOCK<\/strong><\/h3>\n
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US FEDERAL FUNDS RATE CHART<\/strong><\/h3>\n
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We believe the collapse of the M2 Velocity rate is similar to a slow decline of economic capacity and output over a longer period of time.\u00a0 We believe this process will likely end in a series of defaults and bankruptcies as a result of capital being stored away into longer-term assets and investments (pensions, investment funds, and other types of longer-term assets).\u00a0 As this capital is taken away from the core engine of economic growth (main street and startups), the process of slowly starving the economy begins.<\/p>

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We believe we\u2019ve already entered a period of decline that has lasted at least 15+ years and the \u201cblowout process\u201d that ends this decline will be somewhat cataclysmic.\u00a0 One way or another, the function of capital must return to levels of activity that supports a ground-level engagement of economic growth and opportunity.\u00a0 A healthy balance of capital available to all levels of society and deployed in means to support growth and opportunity is essential for the proper health and future advancement of global economies.<\/p>\n

It appears that after 2008-09, the global economy disconnected from reality as investors began relying on institutional level investments and speculation in large scale assets instead of ground-level investments and core economic function.\u00a0 This translates into a very euphoric mode for stocks and commodities where capital chases capital around the planet seeking out undervalued and opportunistic investments\u2026\u00a0 until\u2026<\/p>\n

Pay attention to what happens over the next 4 to 5+ years related to the COVID-19 virus event.\u00a0 We believe this virus event could be a \u201cmonkey wrench\u201d in the capabilities and functions of the global economy over the next 5+ years. Pay attention to what is really happening as capital plays the \u201cdog chasing its tail\u201d routine and the central banks attempt to stimulate economic activity by printing more and more money.\u00a0 If you understand what we are trying to suggest in this article \u2013 printing more and more money at this stage of the game is like saying \u201cdiving out of the 20th-floor window is not enough \u2013 let\u2019s go up to the 50th<\/sup> floor and give it a try\u201d.<\/p>\n

Hang tight, there are going to be some very interesting and big price swings over the next 4+ years in the US and global markets.\u00a0 Skilled technical traders should prepare for the opportunity of a lifetime if they understand what to watch for and how to protect assets.<\/p>\n

You don\u2019t have to spend days or weeks trying to learn my system.\u00a0 You don\u2019t have to try to learn to make these decisions on your own or follow the markets 24\/7 \u2013 I do that for you.\u00a0 All you have to do is follow my research and trading signals and start benefiting from my research and trades.\u00a0 My new mobile app makes it simple \u2013 download the app, sign in and everything is delivered to your phone, tablet, or desktop.<\/p>\n

I offer trading signals for active traders, long-term investors, and wealth\/asset managers.\u00a0 Each of these services is driven by my own experience and my proprietary trading systems and modeling systems.\u00a0 I have a small team of dedicated researchers and developers that do nothing but research and find trading signals for my members.\u00a0 Our objective is to help you protect and grow your wealth.<\/p>\n

Please take a moment to visit\u00a0TheTechnicalTraders.com<\/u><\/a><\/strong> to learn more.\u00a0 I can\u2019t say it any better than this\u2026\u00a0 I want to help you create success while helping you protect and preserve your wealth \u2013 it\u2019s that simple.<\/p>\n

Chris Vermeulen
\nChief Market Strategist<\/p>\n

TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders\u00a0 – M2 Velocity is the measurement of capital circulating within the economy.\u00a0 The faster capital circulates within the economy, the more that capital is being deployed within the economy to create output and opportunities for economic growth.\u00a0 When M2 Velocity contracts, capital is being deployed in investments or assets that prevent that capital […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-171251","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/171251","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=171251"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/171251\/revisions"}],"predecessor-version":[{"id":171254,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/171251\/revisions\/171254"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=171251"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=171251"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=171251"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}