US Federal Reserve ceases to publish M3 index
Thursday, April 27, 2006
On March 23, 2006 the Federal Reserve ceased publication of the M3 monetary aggregate, in line with an announcement it made in November, 2005. The M3 is a measure of money supply in the United States,
The M3 is most general of the many measures of money supply, the quantity of money available within the economy for purchasing goods, services, and securities. The money supply is monitored and adjusted by a central bank, to keep inflation in check, because money supply has to change in tune with real Gross Domestic Product (GDP) to prevent inflation (or deflation).
In November last year, the US Federal Reserve announced that it would cease publishing M3 data, saying, "[the] M3 does not appear to convey any additional information about economic activity that is not already embodied in M2 and has not played a role in the monetary policy process for many years", adding that the costs of collecting the data required for the index outweighed its benefits.
Some commentators have questioned this decision and have speculated that this would allow the Federal reserve to covertly fund the US budget deficit and its negative balance of trade or hide the fall in international demand for the US dollar. In March, 2006, Rep. Ron Paul introduced a bill (HR 4892) requiring the Federal Reserve to reverse its decision.
- "Discontinuance of M3" — , March 9, 2006
- Jim Jubak. "Fed kills a key inflation gauge" — , March 31, 2006
- Dinesh Narayanan. "Dwindling dollar: World may sneeze on US cold" — , April 27, 2006
- "Money supply" — , April 15, 2006
- Europe 2020. "EUROPE 2020 ALARM / Global Systemic Rupture March 20-26, 2006: Iran/USA - Release of global world crisis" — , February 15, 2006
- Federal Reserve Board. "FEDERAL RESERVE STATISTICAL RELEASE" — , April 6, 2006
- "(HR 4892) Sunshine in Monetary Policy Act (Introduced in House)" — , March 7, 2006
|This page has been automatically archived by a robot, and is no longer publicly editable.|