Definition from the St. Louis Fed: "Velocity is a ratio of nominal GDP to a measure of the money supply (M1 or M2). It can be thought of as the rate of turnover in the money supply--that is, the number of times one dollar is used to purchase final goods and services included in GDP".
With the Government bailouts and dramatic increase in the money supply, velocity should confirm if money is actually leaving the banks and stimulating (or trying to stimulate) the economy. If money velocity starts going crazy, that's where the hyper-inflationary fears come in, which will probably result in the Fed raising rates dramatically. The Fed doesn't see that happening any time soon though (see FOMC Statement 9/21/2010). Q3 data should be arriving soon. Charts after the jump.
Nominal GDP/MZM, Nominal GDP/M2 (Ratio Scale) Through 9/21/2010
M1 Velocity (Source: St. Louis Fed)
M2 Velocity (Source: St. Louis Fed)
MZM Velocity (Source: St. Louis Fed)