Theyre LOSING Control Of The Money Supply | Mark Moss

➡ Mark Moss talks about how the money supply has been shrinking for the past year and a half, hinting at possible economic downturns. However, it’s now starting to grow again, despite the Federal Reserve’s decision to maintain current interest rates. This video discusses how the Federal Reserve is subtly changing its monetary policy, leading to a rise in asset prices and new opportunities. It also provides strategies to protect your wealth and thrive in this changing economic landscape.

➡ The article discusses how the Federal Reserve and Treasury Secretary Janet Yellen used words, not actions, to stabilize the market during a bond collapse. They didn’t add money to the market, but their reassurances helped boost prices of assets like Bitcoin, Nasdaq, and houses. The article also explains how billionaire investor Stanley Druckenmiller believes that liquidity, or the availability of money, is what really moves prices, not the fundamentals of a company. Finally, it provides a formula to measure liquidity and explains how to interpret different financial charts.

➡ This article talks about how to understand and use financial data. It explains that the balance sheet, treasury general account (TGA), and reverse repurchase agreements (RRP) are important to calculate total liquidity. It also emphasizes the importance of global liquidity, not just U.S. liquidity, and how it affects asset prices. The article suggests ignoring mainstream media and focusing on what financial leaders are saying, as well as holding onto scarce and energy-intensive assets when global liquidity is expanding.

Something very strange has been happening to the money supply, because for the last year and a half, the total money supply was constantly shrinking. And at the sudden rate it was contracting, it was signaling that recessions and even depressions were coming. But even though Jerome Powell and the Fed are holding the line on the anticipated pivot and the rate cuts, the money supply is now reversing course. So what’s going on? Are they gaslighting us? Or is it something more secretive, something more stealth? And if so, how can we use the secret stealth move to build our portfolios faster? So let’s take a look.

In this video, I’m going to break down how the Fed is secretly loosening monetary policy, how this stealth easing is triggering a surge in asset prices and creating new opportunities. What indicators you need to be watching so you don’t get faked out again by the Fed’s official narrative, and of course, strategies to safeguard your wealth and potentially thrive in this evolving economic landscape. So let’s go. All right, welcome back.

If you’re new to the channel, my name is Mark Moss. I make these videos to change the way you think about money because almost everything that we learned was wrong. And if we’re only watching mainstream media, almost everything we’re hearing, we’re seeing is also wrong. But don’t worry, I got your back. I’m going to break down the data. This is fact. All right? You can’t argue this stuff.

This is data. I suppose you can interpret it differently, but I’ll leave that up to you. Okay, so the first thing is the fight against inflation. I’m not going to spend a lot of time here because if you’ve been watching my videos, you already know this is a big deal. We have Jerome Powell here, the head of the Federal Reserve, fighting, trying to slay the dragon, the inflation dragon right here.

There’s the AI generated image right here. Let me know what you think about that. But basically, Jerome Powell has been trying to tame or slay the dragon of inflation by raising rates at the fastest rate in history. You already know this. What this is trying to do is they’re trying to regain confidence. They want the market to be able to trust that the Fed has things under control.

As if some guy, some banker, can control a complex system like the financial system. Anyway, that’s a different story. However, what they’re really trying to do is trying to hold the line. You see, he was too late. He acted way too fast, so it led for him to be overreacting. And now they’re saying they’re going to hold rates longer for hire. Now, a lot of the market was expecting the Fed to pivot or go from tightening to easing or start lowering rates last year, last December.

But of course, that didn’t happen. We see headlines here from December where Fed chair powell says cutting rates right now is premature. He says premature. And actually they said in December more hikes could even come, which really shocked the market because most of the market was expecting these cuts to come. And then we can see that just this week we have this headline right here that Powell is reinforcing position that the Fed is, quote, not ready to start cutting.

So they’re not ready. So they’re trying to hold it off as long as possible, even though, because they want to continue to slay that dragon. Now right here, he says, don’t want to ease up too quickly. This is a key point right here. This is not directly from his mouth. This is from CNBC. So it’s very important to understand that the committee does not appropriate to reduce or expect to reduce until confidence that inflation is moving sustainably towards 2% and lowering rates too quickly risk losing the battle against the dragon monster of inflation.

All right, so this is what CNBC said just a couple of weeks ago, or actually just this week. All right, so you can see that now, he doesn’t want to be this Paul Volcker type who was the head of the Fed when he pulled back too soon and inflation went on to rage on. So Jerome Powell wants to be the guy who slayed the inflation dragon, so to speak.

So that’s sort of where we’re at. However, when we’re listening to this, we have to understand we need to go directly to the source. And so the reason why I pointed out that was CNBC’s take, that was CNBC’s interpretation of what Powell said is because I actually want to hear directly from Jerome Powell himself. And the reason why is because we used to have under fed chair like grainspan, it was something called Fedspeak.

Fedspeak was basically where they talked in riddles so that you couldn’t understand what they said. And they did that intentionally because they did not want to move the markets. But that’s gone. Today we have something called forward guidance. And what Jerome Powell does with forward guidance is he actually is trying to move the markets off of what he says. So it’s a big difference. And so because they’re literally telling us in advance what they’re doing, they’re literally trying to move the markets based off of what they say, not what they do.

It’s very important that we go directly to them as a source. So I have a little clip of a video that I want to show you right here. Let’s hear it directly from him as he was on 60 minutes approaching the entire nation. It must have been pretty important. Let’s go ahead and play that clip. Are you committed to getting all the way to 2. 0 before you cut the rates? No, that’s not what we say at all.

No. Almost all of the 19 participants who sit around this table believe that it will be appropriate in their most likely case for us to cut the federal funds rate this year. And what is the danger of moving too late? If you move too late, then policy would be too tight and that could easily weigh on economic activity and on the labor market, maybe a recession. Right. And we have to balance those two risks.

There is no easy, simple, obvious path. Okay, so you heard it directly from his mouth as he addressed the nation on 60 minutes. So he wanted everyone to hear directly from him what he say. A couple of things. One, cuts are coming. They are definitely coming. Number two, no, they’re not committed to 2%. We’re not going to wait till we get there. We’re going to move when we’re ready.

And when is that? Well, the third piece is that there’s way more danger in being too late than there is too early. So if we have to choose one, we’d much rather be early than late. Those are very important words from him. And as you can see, it’s quite a bit different than what we are seeing from CNBC. All right, now, if we keep digging in, what I want to show you is that even though it appears that the Fed is fighting off inflation, they’re taking this strong stance in the media.

There’s actually something going on behind the scenes and there’s a secret stealth plan in place. Okay, so while they’re being tough on inflation, fighting the inflation monster, to the media, and really media is interpreting his words differently. As I said, there’s really a stealth easing, a secret easing that’s really going on. Are they really that tight? Well, let’s take a look. You might remember me talking about this BTFP.

It’s called the bank term funding program. In March of 2023, when the banks went collapsed and went collapsed, they had a bailout package called this bank term funding program. And what you can see is, well, the banks used a lot of that money and it continued up, up. And as a matter of fact, we’re at $164,000,000,000 right now. Now, just to put this into some perspective for you, in 2008, when Bear Stearns collapsed, which is known as sort of the trigger that caused all the banks to collapse, it took seven months for the Fed to get a bailout of 100 billion.

Here we got 160,000,000,000 in six days, not seven months, six days. This is a very key piece to understand how the Fed interacts in the markets differently. In addition, what happened in October of last year, something big happened. We had a very, very bad treasury auction, meaning there were not enough buyers to buy the government debt, the US Treasuries, and it led to what we call treasury market dysfunction.

I did several videos on that, and it caused Janet Yellen and fed chair Jerome Powell to go jawbone the market up. What does that mean again? Forward guidance. They went and talked the market up, said that they are going to do these things, that they’re going to bail the market out even if they didn’t. And this is a very key piece to understand why most people get it wrong, because you listen to these very smart, smarter than me, financial analysts, and they’ll say, well, technically, they didn’t do anything.

And technically, they’re right, they didn’t. But what they did do is they jawboned, they talked, and the talking was enough to move up the market. So technically, yes, they didn’t inject liquidity, technically. But technically, they did talk. And technically, forward guidance is to manipulate the markets. So in my opinion, they did do something, and they certainly did. We can see this right here. This is a headline from October.

Treasury Secretary Janet Yellen tries to calm the markets amidst a historic bond collapse. So the market was crashing. Massive dysfunction. They had to go do something. They weren’t ready to inject liquidity, so they just talked the market down. It’s a pretty big deal. Now, how do we know if that worked? Well, we can see it very easily. While the Fed was talking now, CNBC and other mainstream media were trying to gaslight you and hide that from you.

But while the Fed was talking job owning the market, guess who was listening? Asset prices. As a matter of fact, we can see this all across the board. Here we have bitcoin. Bitcoin is always the first asset to sniff this out. It’s the canary in the coal mine, if you will. And we can see that bitcoin had been relatively flat, obviously volatile here. But right here in October, what happened? Oh, it heard that the Fed was going to Jabo in the market and provide liquidity secretly, not officially.

And look what happened to the price of bitcoin. What else? Well, we have Nasdaq, same thing right around the same time here. We have it right here. And look at that. Just took off. Now, remember, bitcoin moves first, then the Nasdaq. If we look back to 2021, November 2021, almost ironically enough, when Jerome Powell announced they’re going to start tightening, bitcoin sold off first. Then the Nasdaq followed within a couple of weeks, and then the S and P 500 followed, but several months later.

So that’s sort of the way it works. So we saw bitcoin, we see Nasdaq, and now we can look at what happened with the S and P 500. It was not to be outdone. And right here at the same time, when the Fed and treasury were jawboning the market, look what happened there. And that’s not the only thing. What about houses? Here we can see houses right about the same thing, have made a new all time high.

And so asset prices are listening. While most people are waiting, thinking the Fed is still in tightening mode, asset prices are telling us something different. Okay, now, if you really want to understand this and you want to understand why this is so powerful and why this is so important, you got to listen to the billionaires. Whenever I get advice from somebody, I just think if I take their advice, will I end up in the same place as they are? And is that where I want to end up? It’d be like trying to get health and diet advice from somebody that was way overweight or trying to get financial advice from someone who’s broke.

And so if you’re trying to get financial advice from certain people that are talking heads on CNBC, you might want to think twice about that. I like to get my advice from billionaires like Stanley Druckenmiller, known as the Goat, the greatest investor of all time. I did a whole video breaking this down, how he was able to beat the market for 40 years without a losing year and have one of the best track records in history.

And the key, I’m just going to spoiler alert for you. I’ll link to the video down in the show notes down below so you can go watch it. I highly recommend it. But spoiler alert for you. When he first became an investor working at a company, he brought all this research, fundamental research, revenues, projections, profitability. And his boss basically said, what are you bringing this to me for? This is all garbage.

And he’s like, what do you mean? This is great work. This is the fundamental research for the stock. And they said, no, go figure out what really moved stock prices. And when you do come back to me, what did he figure out? It was. Well, he figured out what really moved prices was not any of the fundamentals, it was liquidity. Yes, it was liquidity. And so if that’s what caused him to have such success, then that’s what we’re looking at as well.

So let’s dig into that. Okay, so the next question we have is, how do we watch liquidity? How do we know what liquidity is? What charts should I be watching, and how can I read it? Like Stanley Druckenmiller. All right, so a lot of people have been asking me since I made that video, how do you measure liquidity? Well, there’s almost endless amount of ways, but let me break it down very simply for you.

This is an easy formula. Bs minus rrp minus the TGA equals what liquidity is. So we can break that down again. There’s tons and tons and tons of ways to look at this, but I’m going to make it simple for you. So the first thing is the balance sheet. The second thing we want to look at is balance sheet minus the RRP, reverse repos minus treasury general account equals the liquidity.

Let me show you how to do that. Another chart here by AI generated that. Okay, so the first thing is, most people are looking at the M two money supply. So notice I didn’t put that in there, but I’m going to show it to you anyway. So most people want to look at the money supply, which is important. And I look at the money supply all the time.

The reason why I look at the money supply is this tells me about inflation. So when the money supply inflates, then prices inflate. All right, so by watching this, I have an idea what’s happening with inflation, but it’s not necessarily the liquidity, if that makes sense, because liquidity moves into lots of different locations. So a lot of people would look at this and go, well, the money supply exploded here, Mark.

I mean, you’re absolutely right. But don’t you see right here that it’s been actually coming down? And people say, Mark, but it’s not liquidity, it’s driving prices, because liquidity has been coming down, but yet they’re rallying. Okay, well, that’s one way to look at it, but let me show you some better ways to look at it. First of all, let’s just go off that metric. Now, what we can see is that it went up rapidly.

And really what it’s done is more or less tapered off. It’s more or less tapered off. So it’s not plunging. But really we have this huge glut, because if you drew this trend line, we should be here. We’re still way above trendline here. So even if you take this for a comparison, we still have lots of money in the system. But what we want to look at is we want to start with the balance sheet.

Okay? So you can go right to the Fred website. You can pull this. There’s plenty of websites, just google how to pull up the balance sheet. And what you can see is obviously 2008, the balance sheet exploded. Exploded here. But what I want to show you specifically is I remembered I mentioned the BTFP, and I showed you that. So as this was drawing down, the balance sheet of the fed was drawing down.

Look at this blip right here. Let me make that a little bit bigger for you. And what you can see is this is when the BTFP facility got its injection that caused the balance sheet to go back up. And of course, it’s been draining down. So what we want to look at is we want to look at the balance sheet minus the TGA. Or first we’ll look at the RRP.

Because you have to understand that money goes to multiple accounts. It’s sort of like I have two checking accounts, a couple savings accounts. I have some cash in my safe, and so I can move money around from account to account. So we’re looking at the balance sheet minus the RRP. Now, the reverse repo is where banks park money at the Fed, and the Fed has to pay them for it.

First of all, you see that it was used a little bit from 2014 to 2018, and then it sort of fell off. And where it really came raging back was right here, right around the time the Fed started tightening. So money started flowing into this account. The Fed has to pay out interest on that account, which is part of the reason why the Fed is basically losing money, printing money for free.

It’s crazy. I’ve made a couple of videos on it. We’ll link it down in the show notes down below. But what we can see here and what everybody is talking about is this sheer danger that’s going to crash the whole market. When this drains all the way down, there’s a little bit left. Sheer danger, sheer recession, depression. It’s all happening as soon as this comes dwindling down. Now, I made a video recently saying how Janet Yellen is purposely draining this account to force the Fed’s hand.

We’ll link to that in the show notes down below if you want to watch that as well. All right, so we can see that. So it’s balance sheet minus the TGA, minus what’s here. But one thing I want to show you is I like to show you the charts, because if you zoom in on this, it’s the same chart zoomed in. What you can see is this is pretty flat right here.

So we had a pretty steep angle, and now we flatlined. Okay. So that’s important to understand. When did it flatline? Oh, about October of last year. Isn’t that interesting? So you have to start to see what they’re saying specifically. And then you watch this data to see how it matches up. Notice they started talking October. Assets started going up in October. This started flatlining October. Are you starting to get the picture? And then finally, minus the TGA or the treasury general account.

So this is the money that the government has. This is the government’s bank account, the treasury account. And you can see since 2008, it’s sort of been in this range, started going higher. Higher. Of course, we had this big spike after the pandemic, and all that money got pushed in the system, and now it’s been moving around. Now, this is somewhat seasonal to see this, because we’re going into tax season.

So people are starting to send their tax returns early, if you will. But we take those measures. So balance sheet minus TGA, minus RRP to give us a total liquidity. And once we have that equation, then we can see what’s called overall liquidity. So we’re just trying to boil it down to a number. And again, there’s the three components we can kind of put into one. Now, I got a couple of these charts here from Jurian Timmer from Fidelity.

So shout out to him. We’ll link to his Twitter down below. He’s definitely a good follow. And what you can see here is his overall liquidity chart right here looks what happened right around October of 2023. Amazing enough. Look how much the liquidity, the overall liquidity has gone up in that same time. So you can see they’re talking about raising rates, potentially raising rates. Again, we’re not going to pivot all of these things, but it doesn’t really matter because the data shows us what’s going on.

We can see this. This is another good chart from him at fidelity showing the sort of the same thing. And what we can see here is the changes in the RRP and the TGA and how it’s starting to dwindle down. So this has given us another overall way to look at liquidity. And of course, you can see its effect on prices. Now, this chart, also from fidelity, is very good as well.

And basically what this is showing us is the gold money and real rates. And so look at the way gold has been responding as real rates has changed. So real rates, real rates are the difference between what the Fed has, the fed funds rate at, and what inflation’s at. Now, what we can see here is the purple right here is the monetary base. So as this monetary base went up, you can see this going up.

As the monetary base went down, you can see this pulling down. And now as the monetary base is going back up again, you can start to see what’s happening in asset prices. So all you have to do is ignore what they’re saying, and you have to learn to watch the data. But this is the chart I really want to show you, because this is what most people get wrong.

Okay? Almost everybody gets this wrong. They want to argue with me on Twitter and what they say is. But Mark, again, look at the M two money supply. Look at. It’s going down. Part of the problem is that you have to understand that money moves globally. So it’s not just us liquidity we want to look at. We want to look at global liquidity. Now, I just recently did a whole video on the George Soros imperial circle, the billionaire circle, something like that.

We’ll link to that video down below, and it talks about how money moves from one country to another. So when the Fed raises rates, it becomes very attractive for other nations to send their money there. So when another nation is easing, even though the Fed’s tightening, the fact that it’s tightening while another nation is easing means that more money will come. Which does what? It pushes asset prices up.

But more importantly, back to this chart. The piece I want to show you is that while M two for the US has been going down a little bit, mostly hanging flat, m two globally has been going up. So the money supply globally has been going up, which means commodities, global commodities, wheat, gold, bitcoin, things like that are shooting higher. So you need to learn to look much bigger than that.

And then I want to show you this. If we look at global liquidity, not us, m two liquidity, but global liquidity and the S and P 500, you can see that they move almost in lockstep. You see that? So let’s just play this out. If global liquidity goes like this, what do you think happens to the S and P 500. Any guesses? An elementary kid could probably recognize that pattern and could tell you.

All right, now that takes us to our fourth and final part of this video, which is now that we have all this information, that’s cool, but what the heck do we do with it? So let’s take a look at what we can do with this information. How do we use it? Okay, so the first thing we want to do, the takeaway here is ignore mainstream media, ignore the narrative, and listen to what Yellen and Powell are saying directly.

Okay? Because they’re telling you forward guidance, they’re telling you what’s going to happen. We want to front run it right. If we’re only looking at what they did, what happens is now we’re reacting to old information. As you can tell, the markets start moving in advance. They’re anticipating what’s going on. So we have to be paying attention. Number two, we want to watch the liquidity data. We want to look at the actual data, not just what they say.

We want to look at the liquidity data. And not just the US liquidity data. We want to look at the global liquidity data. Now, we talked about that, the balance sheet, the RRP, the TGA. So look at those. But also, again, look at global liquidity. Global M two. I always keep my eye on that. And then, most importantly, at this time, when global liquidity is expanding, we want to be holding assets, specifically, assets.

More specifically, we want to be holding scarce assets and energy intensive assets. So scarce assets being fine art, collectible gold, cars, things like that, of course, bitcoin, waterfront property, things that there’s just not a lot of. They go up a lot faster. Energy intensive assets are typically commodities. So think gold, think oil, think energy, natural gas, uranium. It takes a lot of energy, takes a lot of time, cost money to get them out of the ground.

Since they can’t be artificially inflated away, we don’t typically want to be holding non scarce or non energy intensive assets. Most of the s and P 500, okay? So that’s how we want to play this. As this continues to rage on. Now, I do want to just say that this can all change. Just like the Fed is saying that they’re watching the data. What did Jerome Powell said? Something about navigating the markets by the stars in the sky or something like that.

Something crazy. But we want to understand that this can change. This is the trajectory that we’re on. We are in a bull market. In bull markets, you buy bounces or you buy dips. Until something else changes. And so I’ll keep you up to date. Make sure you keep watching this channel. And if you want to know where this is really all going in the longer run, you’re going to want to watch this video right here about the end of the international monetary order.

All right. But like I said, follow this channel. Make sure you’re subscribed if you’re not already subscribed, so you can keep up to date as this all changes so you don’t get caught off side. Of course, as always, thumbs up if you like it, thumbs down if you don’t. At least leave me a comment. Why? And that’s what I got to your success. I’m out. .

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