The 700 hundred billions were not meant to be thrown in the fire.... it's to replace destroyed capital. With it, you're not going to fuel a continuing credit bubble that has already burst, it's done. The problem you're facing now isn't about should you go on with easy credit, it's, will you have the credit you need to just insure the normal economic day to day demand, because right now you don't have it anymore.

True, no ordinary company can do what Fannie and Freddy have done, that said, the financial system doesn't have anymore the capital the banking system needs to generate the credit the actual level of GDP requires. If you decide to not replace it, you choose to head for a GDP reduction, it's a choice that can be made but you have to know about it.

Inflation wise, it's probably worse to ask the Fed to finance daily needs than it is to replace the destroyed capital through an increase of the deficit and borrowing.