ABSTRACT
A revival of interest in money has been sparked less by concern with business cycles than with concern about inflation. Easy money policies were accompanied by inflation; and inflation was nowhere stemmed without a more or less deliberate limitation of growth of the money stock. The outstanding cyclical fact about the stock of money is that it has tended to rise during both cyclical expansions and cyclical contractions. The reason is that independent errors of measurement in the original stock series introduce negative serial correlation into first differences. But despite these short-term irregularities, the series shows clearly marked cyclical fluctuations corresponding to reference cycles. Evidence on cyclical timing derived from a comparison of turning points is clearly not available from the stock of money series, because it has so few turning points. The ratio of income to the stock of money, which is to say, the income velocity of money, has been rising in the post-World War II period.
