Does "Printing Money" Lead to Inflation?

Lucky for us, someone has the 411.

Fundamental Theorem of Monetary Inflation

The October 2009 U.S. federal budget deficit numbers are in. Americans are apparently clamoring for austerity. People on Wall Street and Main Street are soiling their underwear over the prospect of inflation. Leave it to Woody Brock to explain it, once again:
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The slide mentioned contains the following:
A set of jointly necessary and sufficient conditions for a monetary inflation:

  1. A large increase in the monetary base (typically, bank reserves) due to central bank financing of a very large fiscal deficit
  2. Banks able to extend lots of new credit
  3. Banks wishing to do so
  4. Customers able to assume more debt
  5. Customers willing to do so
  6. A Central bank that is not aggressive in sterilizing money creation

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