Helicopter Money: Nah, That Would Never Happen…Think Again!

 

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I’ve long understood Friedman’s concept of “Helicopter Money,” but until last year, I had never explicitly encountered the term outside of academia. So when I saw an FT article mention “Helicopter Money” as a possible last resort alternative to QE, I instinctively dismissed it as hyperbole. Since then, however, I’ve noticed the term popping up in more and more places. To be sure this wasn’t some form of cognitive bias, I looked to Google for guidance, and boy was I shocked!

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The above graph depicts worldwide English search volumes for the term “Helicopter Money,” since 2004. Since February of 2016 – just last month, search volumes have increased nearly 600% to roughly 7,000 searches a month! With Mario’s March bazooka already looking quite impotent in the face of a Euro above 1.14, I wouldn’t at all be surprised to see more and more talk of such forms of stimulus. Keeps your eyes open for weak European wage data and continued Euro strength as signals preceding the drop(s)!

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