Tell me more, seriously. I've been thinking it was the unexpected decrease in velocity that was bumping us toward deflation in the near term, and that we are in imminent danger of rapid inflation when velocity returns to "normal" - - - but you're suggesting the trouble is really the money supply, not the velocity?
I'm in the deflation camp (at this point) because of the decreasing velocity - the Fed is "pushing on a string" with vengeance and it is STILL going down. The majority who still have jobs, for the most part, have the "There but for the grace of God" attitude as they see their compatriots get laid off in batallion strength. So, they defer all but needed purchases.
Combine that with those who have been laid off and have little spending power, and the Feds can create money up a gum stump and get nowhere. Top it off with the MASSIVE, and in many cases incalculable, debt that sucks up liquidity like a sponge and that light at the end of the tunnel is really a Black Hole in disguise.