Probably the velocity of money is much more important than the amount of money but harder to measure.. Money is a proxy for energy, so if I were to measure the velocity of money I would look at energy use?
It all gets a bit complicated really.
In any case I just don't think they can stop the debt cycle without another deflationary scenario, not enough money exists in the world to pay off all the debt with interest, therefore they have to create more money and they do this by creating debt.., I guess the Fed becomes the sub-sub prime buyer of debt?
It's a one way system of musical chairs and you don't want to be left standing when the music stops... personally I think they can keep the music playing for another decade or so but we certainly live in interesting times...
