On a scale of zero to four thousand...

...and against this background...

I quoted Ron Robins a year or so ago:

What must be noted is that for the thirty years prior to the late 1970s the credit-to-GDP ratio held steady around 1:1.4.

I just finessed that a little, and changed the 1.4 to 1.35. The following graph compares GDP and non-financial debt for the years through 1980:

Graph #1: GDP is red, Nonfinancial debt is blue

...let us compare various measures of money:

AMBSL

Graph #2, comparing Base money

The green line is Base Money times 20. Base is the money issued by the Federal Reserve. Base money grew more slowly than GDP, and more slowly than total credit market debt, in the years before 1980.

M1SL

Graph #3, comparing M1 money

The green line is M1 money times 7. M1 is spending-money, or money in circulation. Like the Base, M1 grew more slowly that GDP and debt, in the years before 1980.

M2SL

Graph #4, comparing M2 money

The green line is M2 money times 2.2. M2 includes M1 and some measures of savings. It is a "broader" measure than M1, and grew faster. As with M1, the FRED numbers start in 1959, and as you can see, M2 growth tracked GDP and total-debt growth very closely until about 1970, and then almost as closely until around 1980. Thereafter, like M1, M2 grew more slowly than debt and GDP.

M3SL

Graph #5, comparing M3 money

The green line is M3 money times 2.2. M3 is a broader measure than M2, and larger, though they were almost equal back in 1959, when the numbers start. From 1959 to about 1970, M3 growth matched very well to total-debt and GDP growth. After 1970, M3 grew faster.

MZMSL

Graph #6, comparing MZM money

The green line is MZM times 2.3. MZM is a narrower (smaller) than M3 and as I understand it is a newer measure. Still, FRED's numbers go back to 1959. As with M2 and M3, MZM growth runs very close to total-debt and GDP growth for a while. But the separation occurs earlier, before 1967 rather than with the 1970 recession. Like M2, MZM grows more s lowly after the separation.

M1ASL

Graph #7, comparing M1A money

An experimental measure, I think, and apparently abandoned in the early 1980s, M1A followed a path very similar to M1 as described above.

M2ASL

Graph #8, comparing M2A money

Another experiment long abandoned, M2A follows a path comparable to M2. To show this, I had to multiply by 3.4 instead of 2.2.

Yes, we have no conclusions.