[quote=jpinpb]Rich – the chart you linked is M2 – Money stock. That’s what’s actually in circulation?! Then why are we not seeing inflation right now?[/quote]
It’s not exactly “in circulation”. If you have $10,000 sitting in an interest-bearing bank account that you pulled out of the stock market in 2007, that money is part of M2. Truth is, we don’t have any perfect measures of money in circulation, because the distinction between checking accounts (in circulation) and savings accounts (not in circulation) became too blurred.
That said, if we use M2 and we adjust for population, we’re only “missing” about 10% of inflation over the last 3 years, probably because of changes in consumers’ thriftiness.
