Alexander Lorenzo explains that 89% of M2 money supply comes from credit, not quantitative easing. Interest rates lead the economy while M2 lags behind, and lower rates are what actually stimulate growth.
Like what stimulates the economy. And contrary to what a lot of people have been saying online, I don't know if you guys knew this, but 89% of all of the money in the M2 money supply comes from credit, not from quantitative easing. This is a misconception that a lot of people do not understand. It comes from credit. So interest rate is a leading indicator. The M2 money supply is a lagging indicator. If you're looking at the M2 money supply, you're late. The leading indicator is lower interest rates. Lower interest rates stimulate the economy.
