Thanks (and I’m not an economist; it’s been forever since even my basic economics course). I was just quoting the page, which isn’t the formula you cited, but
“Calculated as the ratio of quarterly nominal GDP
(https://fred.stlouisfed.org/series/GDP) to the quarterly average of M2 money stock.”
Since, as you noted in your original, they’re printing money by the bucketloads, of course GDP/M2 will decrease; intuitively to me that says that while whatever $ are flying about might not be recessionary, the real world IS because each $ is worth that much less in real wealth.
I do have a little advantage: I taught this stuff for 30 years at several universities. The quote you gave:
“Calculated as the ratio of quarterly nominal GDP
(https://fred.stlouisfed.org/series/GDP) to the quarterly average of M2 money stock.”
is actually the same, since the output of an economy is Q which is sold at some average price (or price level) P. Velocity is actually the number of times the money supply must work its way through the economic system to buy that output (i.e., V * M). Hence my original equation PQ = MV. Therefore:
V = P * Q / M
Or V = GDP / M
which is what your quote says. While some argue for using M1 for M above, your quote choose to include near money, or M2.