The markets are closed today in the United States, in honor of Dr. Martin Luther King Jr., but the government’s printing presses never take a holiday. In fact, the Federal Reserve has been spitting out dollars at an annual pace not seen since in nearly two years.
M2 money supply advanced by 5.6% for the past 52 weeks through January 1, 2007, according to Fed data. That’s the fastest rate of increase for 52 weeks since February 7, 2005. Calculated on a 10-week basis, M2’s pace isn’t quite a strong relative to recent history, but it’s clearly taken flight and is just a shade under the previous 10-week peak of 2.4% set back in May 2003.
