- The U.S. money supply has risen significantly amid the pandemic.
- U.S. national debt is on its way to $27 trillion.
The pandemic has created a period of economic uncertainty as many countries enforce lockdown. During the pandemic, the Federal Reserve has also been handing out trillions in aid via methods including quantitative easing and direct-payments (stimulus). However, the U.S. money supply has been rising rapidly since the start of the pandemic.
The M1 money supply includes coins and paper currency in circulation, representing the most liquid part of the overall money supply. While it looks like the M1 money supply is beginning to decrease, it is still up over $1 trillion from January. Furthermore, amid the new influx of money, U.S. bank deposit inflows are surging like never before, The Crypto Associate reports.
The recent growth in the money supply may have longer-term consequences. A substantial rise in inflation may adversely affect the U.S. dollar, the world’s current reserve currency.
U.S. National Debt On Its Way To $27 Trillion
In addition to the U.S money supply, the national debt has also been rising rapidly amid the pandemic. As reported previously by The Crypto Associate, the U.S. national debt is now on its way to a record $27 trillion. Furthermore, The Committee for a Responsible Federal Budget, a non-partisan organization, estimates that federal debt will grow by $4 trillion in 2020.
The rising national debt may also affect the U.S. dollar in the long term as concerns over the country’s ability to sustain the evergrowing debt arise.
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