[achompas]

Before going any further, I should point out (as a former economist-in-training) that the relationship between money supply and prices is not understood well. The Quantity Theory of Money is a theory in the truest sense of the word, and has been challenged by other schools of thought.

With that said, the equation's main point is that prices grow proportionally to money supply if velocity and transactions are also proportional to one another. As you've stated, we cannot measure V and T, so we're not sure of the relationship between prices and money.

There's really no reason to fret, though. As someone who helped with research at the Federal Reserve Board, I can tell you that research into this area is thriving, and our understanding of the relationship between money and prices constantly evolves.