The total M2 money stock is about 14 trillion dollars. Small time deposits are a component of the M2 money supply. Small time deposit money stock is at about 457 billion dollars. Small time deposit stock is defined as the following:
“Small-denomination time deposits are those issued in amounts less than $100,000. All IRA and Keogh account balances at commercial banks and thrift institutions are subtracted from small time deposits.”
In other words, this is average Joe’s time deposit. These time deposits are, no doubt, a very small component of the M2 money supply. The growth of small time deposits has been on the rise since Q2 of 2017.
Growth of this money supply has not been positive since the 2008 recession. What gives? I believe this can be explained by rising interest rates. The small guy and people on fixed incomes have been decimated by Federal Reserve policy over the last decade. The moment interest rates began to rise, they piled into time deposits. They are searching for yield. Even though interest rates are still very low by historical standards, they are willing to take the risk free money over buying stocks.