Deflation-minded individuals are no doubt cheering the recent M3 data featured today in a Bloomberg “Chart of the Day” along with other measures of the money supply.
(By the way, does anyone know how to actually get the chart of the day at Bloomberg? I’ve yet to find a link to a chart in any of these pieces, the graphic above coming from this FT Alphaville report where, apparently, they were somehow able to find it.)
As for M3, it’s not all good. The broadest measure of the money supply (abandoned by the Federal Reserve back in 2006 but reconstructed elsewhere, for example by Capital Economics above) is now down 5.4 percent from a year ago and the fear of fewer dollars chasing the same amount of goods has more than a few economists thinking that we’ll be seeing lots of minus signs in front of the inflation numbers for some time to come.