The coronavirus crisis has led to the implementation of Modern Monetary Theory

The coronavirus crisis has - probably permanently - led to: A considerable increase in fiscal deficits; With monetisation of these deficits that prevents crowding-out effects, i.e. a slowdown in private sector investment via a rise in interest rates. So we are seeing exactly the economic policy suggested by the proponents of Modern Monetary Theory (MMT). It is well known that the subject of the debate is not the short-term effectiveness of this MMT policy, but its medium-term costs: It is probably not inflation anymore ; It is rather asset price bubbles (especially in real estate) that may grow and then burst; And also high volatility in asset prices and exchange rates, associated with high capital mobility between asset classes and between currencies; At the extreme limit, this is a "flight from money", as economic agents try to get rid of the excessive quantity of money they hold. All in all, the problem with unlimited money creation is that economic agents do not want to hold an unlimited quantity of money.