Money Matters Presentation
Money Aggregates

These popular money aggregates, used as economic data, all meet the definition of money.

M1

Currency, traveler's checks, demand deposits, and other checkable deposits

M2

M1 plus retail money market mutual funds, savings, & small time deposits

MZM - Money Zero Maturity

M2 less small-denomination time deposits plus institutional money funds.

MZM has become widely used since the discontinuation of the M3 aggregate. As a broad definition it covers most instruments that affect dollar prices.

Note: I have highlighted Currency, because it deserves special attention later in this presentation.

Now that we have defined money, let's look at the effects of changes in the quantity of money (Inflation/Deflation).