It's been quite some time since I've posted M2 numbers. Been busy with a book project on the Fed Model.
The M2 numbers have accelerated to levels not seen in ages.
http://federalreserve.gov/releases/h6/current/default.htm
Q/Q annualized in excess of 11%? This is an incredible set-up for the bond market, where yields have declined to levels last seen in the first quarter of 2009. Bonds got wrecked in the first half of 2009, in no small part because of the spike in money supply growth we experienced back then.
It would appear that we're setting up for a repeat performance. This is an excellent time to be shorting Treasuries again.
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