Albert E. Burger presents a framework of analysis that helps unravel this mystery. Burger derives multipliers that link the monetary base to M1, M2, and M3. The component ratios of these multipliers summarize the key asset portfolio decisions made by the public that affect the growth of the aggregates. The author presents the recent behavior of these ratios in a historical context to emphasize the dramatic nature of the changes that occurred in the 1980s. He traces the acceleration in M1 relative to base growth to the sharp rise in the public’s holdings of checkable deposits relative to its holdings of currency, an unusual historical development. Burger also shows that M2 and M3, in addition to being affected by this development, also have been affected by a rise in the public’s holdings of checkable deposits relative to the other financial assets that com pose these aggregates. The key developments associated with this changed behavior of the component ratios—the financial innovations in the 1970s and 1980s, and the sharp reduction of inflation and interest rates in the 1980s—are also discussed. The author shows that, although the relationships between the growth of the monetary base and the M1, M2, and M3 aggregates changed significantly in the 1980s, the growth of these monetary aggregates remains tied to the growth of the monetary base.