the most likely outcome is hyperstagflation(smokey)

The Fed cannot create hyperinflation in a low wage service/retaileconomy. Easy credit and monetization at this point will at bestproduce a hyperstagflationary scenario where exponentially risingprices for necessities like food and fuel overwhelm the economy'sability to expand.

In order for hyperinflation to occur, thegovernment would have to continually increase dollar donations to thepublic as prices rise due to monetary inflation.

Since thisprocess must include massive deficit spending, and since we have nonational banking system, the government would have to sellexponentially increasingly debt to cover these expenses.

As moreand more debt is sold, a steadily decreasing amount of creditors woulddemand interest rates which exceed the growth of inflation. As interestrates rise, saving would be more attractive to the public therebynegating the stimulating effect on the economy.

The Fed couldmonetize this debt at low interest rates, but since this action wouldbe in direct conflict with the function of the banking system, thiswould be an unlikely scenario.

So the most likely outcome of Fedstimulative actions is hyperstagflation wherein prices for necessitiesinflate while wages remain stagnant.

But since our economy isbased on the consumption of nonessentials, the rise in the prices fornecessities would result in growing unemployment and rampant businessfailures eventually leading to a deflationary breakdown in the economicsystem.

Therefore hyperinflation is not likely.... Hyperstagflation is possible....

But the natural adjustment of economic forces through a defaltionary depression is unavoidable.