From December 2007 to December 2008, the Fed has increased its monetary base from US$829,843,000,000  to US$1,659,248,000,000. This is equivalent to 100% increase it monetary base. The monetary base has a significant influence on the Money Supply. The Fed is trying to print as much money as possible. Some people say that this will cause inflation by 100%. But has this happen? From observation no. In fact, the Money Supply as measured by M2 increases from  US$7444,000,000,000 to US$8171,000,000,000 during the same period. This is equivalent to just an increase of 9.8% of M2 money supply. Why is it that despite the fed printed 100% of its monetary base money did not result in equiavalent 100% increase in the total money supply? The reason is because money supply is a function of monetary base, banks' desired reserve ratios and desired currency drain ratio. As we all know, during this financial crisis, many banks are not willing to lend money. This means that the banks' desired reserve ratios are extremely high. In future when the economy is stabliise, the M2 will not surge upwards because the Fed can always increase its reserve ratio requirement to curb increase in M2 supply. For more information on how money is printed, see my article HERE.

 Source: http://www.federalreserve.gov/releases/h3/hist/h3hist1.txt, http://www.federalreserve.gov/releases/h6/Current/