The balance between the monetary base and the available amount of goods and services is provided through the system of prices. If the parity is broken by excessive issuance of money, prices will have to change too, and inflation may soar.
That’s a basic monetary law.
However, economic laws do not have the fixity of natural laws, and some economists are now contending that there is some decoupling between money supply and inflation. Continue reading “How much Helicopter Money can be created?”