** Compared with business' bankrupt and high government borrowing cost, high inflation is a much worse disaster.
** After the growth stocks' pool is filled full, money is inflating price in the economic area.
** OT and YCC will not work to absorb continuingly added money enough to avoid the high inflation.
Our money-tracing model indicates that the signals of inflation were firstly seen in consumers' goods and services. Rising price was then found in more sectors attributable to the unpacked capacities and, more probably, the hungry moneys in circulation.
Because growth stock' price is more sensitive to changes in its required return rate, money flooded into these stocks as a result of lowered debt' yield. As stocks' prices were pushed up, the active moneys in circulation then run into production and service areas. This is how Fed's further purchasing debts will eventually lead to disastrous high inflation.
In fact, Fed could avoid such a dilemma between high inflation and business' bankrupt or government's higher borrowing costs given that the $1.9T stimulus checks were sent out earlier in a more gradual way. Again, solving a problem at the consumption end should always be preferred.