It's about time to post a follow-up on the aggressive printing campaign by the Fed. Since last September, money supply has taken off in a skyward trajectory, only recently showing any sign of gradually leveling off. Naturally, this is of concern to anyone whose wealth is invested heavily in U.S. dollars, since more money supply implies weakening of the dollar.
Until September, base money remained fairly level at $850B. Since then it has expanded by $900B to be just shy of $1800B. However, bank reserves have followed that trend almost exactly: from a stable $100B reserve level until last September, they have grown by $850B to $950B today. So, base money has grown by $900B, and bank reserves by $850B.
Meaning, the dollars recently created by the Fed aren't doing anything. They are sitting in banks sequestered from the economy. The Fed and Treasury Department were hoping banks would lend them out, but there aren't very many good lending opportunities these days. Plus, banks are about to get slammed by the Alt-A implosion, and so the excess reserve capital may be put to use to weather that storm.
So, unless the money the Fed printed actually enters the economy through fractional reserve credit, its effect on restraining deflation has been surprisingly minimal.