US is `printing' money to help save the economy from the COVID-19 crisis, but some wonder how far it can go, by BRENT SCHROTENBOER

Tcherneva is on the opposite side of the spectrum from Paul. She is a proponent of "Modern Monetary Theory," which argues that the government can always pay its bills by creating more money, minimizing the importance of deficits and debt.

Does 'creating' money create an inflation risk?

Paul, the former Texas congressman and author of "End the Fed," predicts such money creation will lead to disaster. He says it will cause overheated financial bubbles fueled by too much easy money in the system – a bubble that could burst with painful fallout. Creating too much money that chases too few goods also leads to price inflation, decreasing the purchasing power of the dollar.

But high inflation didn’t materialize the last time the Fed created money on a similar scale as part of its efforts to revive the economy during and after the Great Recession. To the contrary, an arguably bigger concern – then and now – has been persistently low inflation, which eventually could lead to deflation, or falling prices, that prompt consumers to put off spending and hurt the economy.

"With the economy so down, and inflation so low, the fears that these kinds of operations will lead to high inflation in the United States seem very farfetched," Blinder said

US is `printing' money to help save the economy from the COVID-19 crisis, but some wonder how far it can go