No. In this case, monetizing the direct subsidy would be creating less deflation, not inflation. And deflation is something we all want very badly to avoid because of all the concomitant pathologies for monetary velocity and contractionary effect.
No. In this case, monetizing the direct subsidy would be creating less deflation, not inflation. And deflation is something we all want very badly to avoid because of all the concomitant pathologies for monetary velocity and contractionary effect.