The distributed lag effects of money flows, the volume and velocity of money, have been mathematical constants for > 100 years.

We knew this already:

In 1931 a commission was established on Member Bank Reserve Requirements. The commission completed their recommendations after a 7-year inquiry on Feb. 5, 1938. The study was entitled “Member Bank Reserve Requirements — Analysis of Committee Proposal” its 2nd proposal:

“Requirements against debits to deposits”


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That was written in retrospect. Money flows are ex-ante. Divisia Aggregates are contemporaneous.

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