Z-Score

A robust normalized measure showing how far a current value is from its rolling median, expressed in MAD-scaled units.

DollarLiquidity.com uses robust z-scores: Z = (Value − Median) / (1.4826 × MAD), where Median and MAD (Median Absolute Deviation) are computed over a rolling 10-year window. This is more resistant to outliers and structural breaks (like QE/QT transitions) than traditional mean/std z-scores. Values are winsorized (clipped) to [-4, +4] to prevent extreme events from permanently distorting the composite score. Z-scores above ±1.0 are notable; above ±2.0 are extreme.