This morning Mish has an entry entitled
Huge Demand For Treasuries As Banks Refuse To Lend in which he cites bank reserves and a sluggish M1 multiplier in support of the conclusion that:

Look at the Base Money chart and the Reserve Bank Credit chart. Base money is soaring but all of it is sitting in bank reserves. In other words, banks are not lending. Clearly we have a huge monetary distortion, but banks seem to understand that lending money in this environment would do nothing but increase losses

Of course, Mish's article is simply received wisdom at this point. There can be no recovery until banks start lending, and they are refusing to lend.

There's just one problem with this argument: it isn't true.