Scott Sumner always quotes Milton Friedman who said something to the effect of "low nominal interest rates indicate that money has been tight, high rates that money has been loose."
I take it by this he was going by the Fisher Equation i = r + π e
Where "loose" money cause expected inflation to rise and hence nominal interest rates; "tight" money does the opposite, while the real interest rate stay constant at the loanable funds equilbrium.
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