And if that money is used to purchase financial instruments, say bonds, from investment banks and hedge funds, those funds then have money to put into other bon

And if that money is used to purchase financial instruments, say bonds, from investment banks and hedge funds, those funds then have money to put into other bonds or stocks, both of which have risen spectacularly in price. The velocity of money may still be low in this case, but asset inflation happened. It may be that the money hasn't trickled out into the real world in large enough quantities to cause inflation yet.