Effects of movements in equities prices on M2 demand
Large swings in stock prices are sometimes associated with a redirection of household savings flows. Such changes can lead to transitory increases in M2 as investors temporarily â€œparkâ€ funds in depository assets while they determine the fundsâ€™ ultimate destination. The authors find that, although stock price changes are statistically significant as an explanation for M2 growth, they do not account for much of M2â€™s recent strength.
Volume (Year): (1999)
Issue (Month): Q IV ()
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