The money multiplier and velocity of money are two completely separate things.
Money multiplier is the mechanism of how money is created by banks issuing loans.
Velocity of money describes how rapidly money moves in the economy.
Governments like to see money exchanging hands rapidly because they benefit through taxation, provides jobs and can potentially make the workforce more productive. The downside of this is that it promotes wanton consumerism which places demands on natural resources and stresses our ecosystem.
The problem with this is governments and businesses alike are dependent on growth measured as GDP. The way GDP is currently measured is erroneous. Growth is neither sustainable nor desirable.
Money multiplier is the mechanism of how money is created by banks issuing loans.
Velocity of money describes how rapidly money moves in the economy.
Governments like to see money exchanging hands rapidly because they benefit through taxation, provides jobs and can potentially make the workforce more productive. The downside of this is that it promotes wanton consumerism which places demands on natural resources and stresses our ecosystem.
The problem with this is governments and businesses alike are dependent on growth measured as GDP. The way GDP is currently measured is erroneous. Growth is neither sustainable nor desirable.