As FT Alphaville points out, the EA M3 multiplier is just over 3/4 its average 2007-2008 level, 7.67 vs 10.
But this is global! The US M2 money multiplier is a little over 2/5 the size of its average 2007-2008 level, 4.1 vs. 9.3. By this simple measure, I’d say that the US is in worse shape than is the EA.
Of note, my visual is a bit different from that in FT Alphaville. Specifically, I don’t agree with SocGen’s estimates that the EA money multiplier drops in December to roughly 6. Given that December 2011 EA base money has been published, a 6.2 M3 multiplier implies that M3 dropped by 15% in 1 month. That’s unlikely.
To my readers: There’s a 92% probability that I’ll be serving on a grand jury for the next three months. Since I’ll need to keep up with all matters EA, I’ll probably be blogging at a higher frequency and in less depth (like this one).
Rebecca Wilder
Source data: The Federal Reserve publishes money supply and monetary base data, which can be easily downloaded at the St. Louis Fred database. ECB data can be found here and here.