You are viewing a single comment's thread from:
RE: Environment has become supernatural
Most of these economic concepts for me are Chinese.
However, I have the impression that the economic crisis is not just happening in my country.
All I know about the velocity of money is that is an inflation gauge, according to Investopedia. So are we in the presence of a global financial crisis? 
If you want to know what money velocity means, I can tell you, so you will understand completely ;) It means: The number of times, each unit of currency changes hands (or bank account owner - if it is transfered from one account to another)
So, let's say I buy some coffee in coffee bar. I pay 1€ to the waitress. She uses same 1€ coin later that day to pay the bills or buy loads of coffee for work. She tips this 1€ to the coffee delivery driver. And the driver uses same coin in the evening to buy a condom :)
So one coin was used in 4 transactions in one day. 1€ bought 4€ worth goods and services - it circulated 4 times.
So....if velocity as whole is low, it means people are not buying things (any more). It means sellers and producers are in trouble. It means, the economy is in extremely bad shape.
At the end of the day ... it's all about money flow, isn't it @worldfinances?
When money flow slows down then economy is in real trouble.
Yours
Piotr
Yes, indeed. That's why QEs are for. To pump up the market, because it is almost dead for few years now. Trying to pump the velocity up. But because we are living in financial fascism, top 0.001% always get financial help from the states, from the QEs, just to keep those companies alive, while other citizens can only dream of "helicopter money" to get to their own pockets.
That's why we still do not see bigger financial crash in US/EU/JP/AU.... but with every QE, average citizens are robbed blind. QEs should be called robbery
Dear @worldfinances
I just realized that (somehow) I've missed your previous comment. Just wanted to thank you for being always so responsive and sorry for such a late reply.
I'm still a bit confused about QEs. Can money be created without debt being also created?
Yours
Piotr
Now I've got it, thanks!
no problem ;)