Hey, this is off topic, but I am no economist and I am curious. I've heard your argument before, and it seems really obvious that this must be the reason we don't have a lot of inflation.
But what is stopping all the money that has been printed from at one point entering the economy and causing inflation? From the previous chart, I read that the amount of money in the US economy has more than quadrupled. Is this a correct interpretation?
Most of the money is passed between central banks and technically insolvent[1] banks, helping them repair their balance sheet and dispose of toxic assets.
Some of the money seeps into the economy and may be inflating stocks and other assets. For example, banks are given loans at zero interest[2] and they can use that money for whatever, e.g. proprietary trading, bonds/treasuries, etc.
Perhaps some of that money finds its way into investment funds and eventually tech start-ups?
The money velocity has tanked: http://research.stlouisfed.org/fred2/series/M1V http://research.stlouisfed.org/fred2/series/M2V