In good times, there is a lot of money on the demand side, which will shift out the demand for research (increasing demand), so that everything else equal we see a larger quantity of grants given as well as larger amounts. In good times, it is also easier to find jobs, and get other sources of funding, so the supply side shifts left, meaning a lower equilibrium quantity, but a greater equilibrium payout.
However in bad times, demand for research shifts left (lower amounts of funding), and supply of research shifts right (more academics seeking funding). This results in an ambiguous change in quantity of grants given out, but much less average dollar size for grants. This is especially depressing for those of us trying to get grants as beginning academics.
So that is a brief story of why yours truly has been trying to get a sizable grant for almost a year now, and in the end has not landed a big one, but several small ones.
You can see another funny article about grants, from the journal "nature" here