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    M1 and M2 money growth rates

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    Why might M1 and M2 grow at very different rates during a given year?

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    Solution Preview

    M1 and M2 descriptions and current rates are given by the U.S. government, among other places, at:


    Note that this gives seasonally adjusted and non-adjusted rates. Says this resource:

    "M1 consists of (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of depository institutions; (2) traveler's checks of nonbank issuers; (3) demand deposits at commercial banks (excluding those amounts held by depository institutions, the U.S. government, and foreign banks and official institutions) less cash items in the process of collection and Federal Reserve float; and (4) other checkable deposits (OCDs), consisting of negotiable order of ...

    Solution Summary

    An overview M1 and M2 money growth rates with specific examples.