Understanding How The Velocity Of Money Is About To Change Your Life

As global economies continue to struggle and lurch toward the next inevitable recession,

money velocity will continue to fall. It’s predictable: in times of uncertainty, people tend to spend less and save more—so as uncertainty grows, money velocity falls more and more.

This is a core reason why Mike believes a real deflation is inevitable. The lack of money velocity we continue to see will grind the global economy to a halt. It’s a negative feedback loop: the more money velocity falls, the worse the economy gets—and the worse the economy gets, the more money velocity falls.

But that’s not all that low money velocity does: it also pushes central bankers to intervene to greater and greater degrees. And the more they intervene, the more they will eventually ignite inflation.

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