The Fed's decision to move into round three of quantitative easing (QE3) was a bit of a surprise -- at least it wasn't expected to happen during the Fed's September meeting. Consensus opinion was that the Fed might hold out a bit longer to see how the economy is doing. Ultimately, it appeared that stagnation in the eurozone and in China trumped the will to wait. Global money supply has dropped recently, and in the U.S. the velocity of money has dropped as well. This year, the M2 money velocity dropped below an index of 1.6 for the first time since records have been kept (1959). Remember, a key to the financial crisis was a drop in money velocity (see chart below and the drop between Q3 2008 and 2009).The fact that velocity is at an all-ti...