> How does it do that? By lowering interest rates which encourages borrowing and thus spending and thus economic activity. > So the fed prints a bunch of mone

> How does it do that? By lowering interest rates which encourages borrowing and thus spending and thus economic activity. > So the fed prints a bunch of money, causing 5% inflation. Printing money causes monetary inflation, but does not directly cause price inflation so you don't need 1.05M to build your factory. Printing money can eventually lead to price inflation if too much money is printed for too long, but that doesn't mean all money printing causes price inflation as that lever can be turned both ways. Lower interest rates to spur spending and get the economy moving again and then once out of danger raise them again.