M2 suggests that rather than right now being a new second problem, the first one from 2008 is still ongoing.
You're looking at M0-esque BASE money supply. Note that BASE doubles in late 2008, plateaus and rose again modestly (25%) this year. M2 has been more subtle, never raising more than 11% annually with a minima at 2% in 2010, but right back at 10% M2 annual growth today.
Yeah, my bad. I was looking at and thinking of AMB but typed M2 instead. I like to think of excess reserves as lurking money, not in the spotlight, but still there. The Fed is paying interest on these excess reserves, so clearly they want the banks to keep the money parked there so that it will be available when needed. Yes, I know they aren't paying
much interest, but it is still enough to keep the banks from dumping them.
