The Dough Rises

Where’s the dough?

The Market Beat column in the WSJ 3/31/09 noted that U.S. Banks traditionally carry about $300B in cash. As of March 18th, they had $976B, more than triple the usual level. The M2 money supply – checking deposits, savings accounts other than IRA saving accounts, money market funds – are up 10% this year.

Americans are saving. The banks just aren’t lending out those deposits as quickly as they are received.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s