The chart below is produced using the numbers from The St Louis Federal Reserve Bank. They are in charge of reporting on the money supply.

On March 16, 2020 the M2 stock was 15,726 billion USD.

As of July 27th, 2020 the M2 stock was 18286 billion USD.

That represents a 14% increase in the money supply in a matter of 4 months.

  • REAL INFLATION = 25.14% from 04/16/20 - 02/01/21

M2 Money Supply - St Louis Fed

What is M- Stock?

In banking the supply of money and credit is broken down into three catagories.


M1 includes funds that are readily accessible for spending. 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; and (4) other checkable deposits (OCDs), which consist primarily of negotiable order of withdrawal (NOW) accounts at depository institutions and credit union share draft accounts. Seasonally adjusted M1 is calculated by summing currency, traveler’s checks, demand deposits, and OCDs, each seasonally adjusted separately.


M2 includes a broader set of financial assets held principally by households. M2 consists of M1 plus: (1) savings deposits (which include money market deposit accounts, or MMDAs); (2) small-denomination time deposits (time deposits in amounts of less than $100,000); and (3) balances in retail money market mutual funds (MMMFs). Seasonally adjusted M2 is computed by summing savings deposits, small-denomination time deposits, and retail MMMFs, each seasonally adjusted separately, and adding this result to seasonally adjusted M1.

M3 - Discontinuted

From Investopidia

M3 is a measure of the money supply that includes M2 as well as large time deposits, institutional money market funds, short-term repurchase agreements and larger liquid assets. The M3 measurement includes assets that are less liquid than other components of the money supply and are referred to as “near, near money,” which are more closely related to the finances of larger financial institutions and corporations than to those of small businesses and individuals

M3 is no longer counted by the Federal Reserve. There are some private people who try to recreate a best guess of M3 such as John Williams from Shadow Stats. However the statistics they provide are best guess and should be viewd as a guide rather than relied upon as accurate.

Why is M2 important?

Since M2 includes the money supply from M1, it is a great indicator of just how much inflation is injected directly into the economy. Inflations is defined as an increase in the money supply. By looking at M2, we can see just how much prices for goods and services will rise.

For instance, when the Federal Reserve through its Open Markets Operations (FOMO) and Open Markets Comitte (FOMC) bailed out Wall Steet and banks, they did so by injecting money into the M3 money supply. As such asset prices for Stocks and housing, which are largely dependent on credit, rose. However because that money did not come into the M2 supply goods and services remained relativly low (4.5% increase annually)

Now is the time to pay close attention to M2. Understanding M2 will help you know where to put your money to keep it safe. Particularly if you do not have a lot of money, understaning M2 will let you know what you are going to need to buy excess of because the price of goods will increase in the future.