I would not get too excited Jay. The economy has been on this expansion since 2011 and money velocity has persistently trended down during the period to it’s current low. That chart is current BTW and includes results from Q1 of 2017.
I really have to wonder if what we are seeing in money velocity now is the extraction of currency out of country along with built up savings for retiring baby boomers. Those would both have a negative effect on money velocity as I understand it. Having said that I feel that money velocity is probably the most critical measure that indicates our problems as an economy.
Keith has a fundamental understanding of fiat currencies that is bone deep in him. I have picked up a lot, studying Modern Money Theory (MMT).
As I said before, my biggest challenge is in making a simple. clean correlation. I recently had some people totally get my explanation of economic growth like I laid out here and was excited to put it down in words. I’m not sure that I am there.
If you were talking to others that study MMT then everybody gets it. It’s talking to the casual person that is so difficult.