I am going to hang this in my office so visitors can ponder.
I don’t have the time to get into the data and see which components are responsible for the decidedly different trends. Just be careful when you start talking about what Bernanke is doing with “the” money supply. If you use M2, then it’s been flat for several months and is arguably back in line with the long-term trend. But if you use the narrower M1, then things are much different. (I am guessing a lot of the above graph has to do with people shifting into more liquid assets, but I haven’t actually looked at the components.)
One thing is clear: Those who are talking about the great “deflationary forces” upon us, need to realize that thus far Bernanke has entirely offset them. Yes, it’s true that the fractional reserve banking system has a harder time creating money out of thin air, when loans are decreasing. But as the chart above shows, the standard monetary aggregates have thus far stood up against this pressure.