Firms have tried to get by with productivity gains instead of expanding their operations, but now they seem to have reached the limit, and capacity utilization is stretched. And on the money-supply side, in an effort to sustain consumer spending, the government has offset slower private bank lending with a massive increase in lending from state-run banks, pushing excess money into the economy. Too much money is chasing too few goods, and inflation's on the rise. This is driven by tangible factors, not broad psychology. The upshot of the IMF's theory is that we needn't fear higher inflation from the U.S., U.K. and Japan's massive quantitative easing (QE) efforts. We'd largely agree with that conclusion -- higher inflation doesn't appear likely in the near term even though the monetary base has risen tremendously in each of those nations. But this isn't because broad expectations are tame. Rather, it's because the new money isn't doing much chasing. In all three nations, most of the QE money is sitting at the central banks as excess reserves instead of circulating through the broader economy. As long as money's idle, it can't really chase prices higher. If banks were to start lending more enthusiastically that would change, but for the moment, there seems to be little fundamental support for higher lending. Regulators in the U.K. and U.S. are incentivizing banks to hoard capital, Japanese businesses don't have much appetite for investment, and QE has flattened all three nations' yield curves, reducing banks' net interest margins. Until those issues resolve, QE likely doesn't have much impact on inflation (or, unfortunately, economic growth). Regardless of what "expectations" might say. This article was written by an independent contributor, separate from TheStreet's regular news coverage.