What’s the difference between adjusted monetary base and currency in circulation?

December 27, 2009 by Currency Trading Tips  
Filed under More Currency Trading Answers

Can you answer nathan_inks’s question about Currency Trading?:

What’s the difference between adjusted monetary base and currency in circulation?

These are 2 charts from the Federal Reserve that are pretty much identical right until the end, so why is there such a huge difference?

http://research.stlouisfed.org/fred2/series/CURRCIR?cid=342

http://research.stlouisfed.org/fred2/series/AMBNS

I think it’s because the bailout money was given to companies not in printed form, but electronically (or traded from the Federal Reserve to the companies’ banks), so it’s there’s more money out there, it’s just not in circulation.

Am I understanding this right or not?

Forex Trading Strategies