Using data from the St. Louis Federal Reserve
(FRED) (http://research.stlouisfed.org/fred2/),
analyze the money supply.
a. Find the values from FRED for the
M1 Money Stock (M1), the Currency
Component of M1 (CURRENCY), and
Total Checkable Deposits (TCD), from
1950 to the present.
b. Plot the growth rate of M1, the currency
component, and total checkable deposits.
What happened to each component during
the 2007–2009 recession? Was this behavior
typical for a recession?
c. How do the growth rates of the money supply
during the 2007–2009 recession compare
to the historical average growth rate?