"Unprecedented U.S. Money Supply Shift Echoes Great Depression, Signals Major Stock Market Activity"

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Source: The Motley Fool
"Unprecedented U.S. Money Supply Shift Echoes Great Depression, Signals Major Stock Market Activity"
Photo: The Motley Fool
TL;DR Summary

The U.S. M2 money supply has experienced a notable decline for the first time since the Great Depression, dropping over 4% from its mid-2022 peak. Historically, such declines have often preceded economic downturns and increased unemployment. Additionally, commercial bank credit has also decreased, suggesting tighter lending standards and potential impacts on corporate earnings. While these indicators may signal a challenging year ahead for investors, historical data emphasizes the benefits of a long-term, optimistic investment approach, with the average bull market outlasting bear markets and 100% of 20-year rolling periods in the S&P 500 yielding positive returns.

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