F, D, H, B, F, R, B. It's easy to remember: Just look at the title of this post. FDHBFRB is the name of a FRED dataset.
There is another dataset too, with the same letters, plus an N at the end. N is for "new", I suppose, suggesting that the original set of capital letters represents a discontinued series. It does.
Here's what I looked at first:
|Graph #1: Discontinued (blue) and New (red) Fed Holdings of Federal Debt, Relative to GDP|
Debt went up, that's what's wrong. Debt went up *way* more than GDP since the 1950s. GDP is a small denominator. GDP makes Federal Debt Held By Federal Reserve Banks look bigger than it is.
Here's a better measure:
|Graph #2: Discontinued (blue) and New (red) Fed Holdings of Federal Debt, Relative to TCMDO|
By the standard of the 1950s and '60s, Fed Holdings since the 1990s should have been twice as high as they were. By that standard, Fed Holdings are low yet today. Even with that big spike there at the end.
Fed holding should be twice as high, or Total Credit Market Debt Owed should be half what it was since the 1990s. Or some combination of the two.
This is the Arthurian policy recommendation: more Fed holdings, and less credit market debt. Why? Because you can use credit for just about everything these days. But you can't use credit to pay off debt.