Is the Fed fabricating loan level data?  Or, less dramatically, is the Fed merely once again goalseeking its weekly "data" to account for a world in which deposit expansion is no longer running at the pace seen in pre-taper days. It would be logical that the one "plug" the Fed would adjust to balance off its model is to boost lending activity, which would explain why the Fed is suggesting lending is surging.

 Unfortunately, lending is not only not surging, it is contracting, if only among the Big 4 banks in the first quarter.

 So whether the Fed has an ulterior motive, or is simply fudging for a lowered Fed reserve creation growth trendline, we believe the people deserve an answer: just what is really going on here?

Why is this data so important? Because absent a pick up in commercial bank lending, which should eventually match and surpass the amount of bank "assets" created by the Fed's QE (which in 2013 amounted to $255 billion per quarter), then bank liabilities can't grow nearly as fast, and as we showed earlier this week, neither can US GDP which is directly correlated to the amount of commercial bank liabilities in circulation.