Question about the velocity of money · Rebel Economist (Free)

Question about the velocity of money

I have a question for Dr. Keen. If the velocity of the US dollar is less than 2, and the average person using the currency is living paycheck to paycheck, spending all of their income every 2 weeks, wouldn't that mean that the volume of the money supply must be inordinately high to sustain the average citizen?

This seems very puzzling to me, and I'd be curious to hear some discussion about that.

Thank you.

10 comments