Looking at Menzies post regarding stimulus

Here. I followed enough of the course handouts to get all his variables defined. He is concerned with the relationship between price inflation and Federal stimulus. Here is my take.

Remember, government at all levels already funds, and continues to fund a large proportion of consumers over the long term. These consumers have not suffered a demand collapse. So we do not have a smooth, distribution of consumers in the contracted state, we have a bifurcated distribution. The second hump of consumers is constant relative to Menzies equations. The money market faces a constant demand for bonds and a variable demand for bonds, over the cycle that Menzie computes. The variable b2, in Menzie's equation, sensitivity of investment to interest rates, is already biased upward. Private investment willl adjust down before a general price rise. Congress cannot be effective with stimulus because of its long term commitments.

The mechanism that this bifurcation has on the curve is that it gets steeper before we see price inflation. These analyses assume we are moving from one bell shaped curve to another, and we do.  But we do this over a longer cycle than the computations that macro economists use.  The unseen part of the stimulus was the decline in investment spending as oil imports rose.  The bifurcation among consumers causes accelaration in the   constrainted input price, the private sector was quite aware of this, so they adapted faster than general inflation.