So the way the modern monetary theory works is the idea is that Congress can increase the government's expenditures.

Right.

Because Treasury can, in theory, if you changed the way the Federal Reserve system works, monetize the debt.

So the way the mechanics would work under the current system is the Treasury Department

would first borrow the money by issuing debt and somebody would buy that and that

could be if the law were changed the Federal Reserve. So the Treasury could borrow money from the Federal

Reserve. The Federal Reserve gives the money to the Treasury Department, and then the Treasury Department

spends the money. And the point is there's no real constraint on that as long as the Federal Reserve

is willing to lend the money to the Treasury Department,

the Federal Reserve can create as much money as it wants.

Now, there are, of course, and modern monetary theorists recognize at least some of these

constraints.

There are constraints because money is sociological.

So if you start doing this, you're going to change expectations about the value of money depending on

how much you're doing this and whether you've restrained in any way your ability to do it in the

future. If you issue huge amounts of new money and there are expectations that you're going to

issue even more,

then people will decide that the money that you're issuing is not worth as much.

They will want more of it in exchange for goods and services that they are turning over

and accepting money in return for.

And so that's inflation. And you can get a lot of inflation if you damage the sociological consensus around the amount of money that there is

going to be because there is a supply and demand that work here, the value of one unit of

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