Forms of Fiat

All the old paintings on the tomb
They do the sand dance, don't you know
If they move too quick
They're falling down like a domino
--Bangles

Modern money creation is a function of fiat. Government simply declares it into existence. Currently, there are three primary forms of monetary fiat:

1) Credit money. Central banks declare an interest rate, and then endeavor to make it so--primarily by setting the price of money at their 'discount window.' Banks borrow from the window at the fiat discount rate, and then use the borrowed funds as the basis for speculating or for making loans to others. Credit money therefore creates a pyramid effect thru the financial system as one dollar borrowed from the Fed's window might be leveraged 10x or even 100x in subsequent loans.

2) Security monetization. Also known as QE, monetization entails central banks lifting bonds out of primary dealer inventory in exchange for money created out of thin air. The Fed sees $500 million in Treasury and agency inventory on JP Morgan's (JPM) sheets, and it buys them from JPM by placing a digital credit of $500 million in JPM's account. Where did those funds come from? From a few clicks of a mouse, baby.

3) Money in the mail. Former Fed chair Ben Bernanke famously declared that central banks could always just drop money from helicopters if financial systems were in need of liquidity. Today, of course, dropping money from the sky isn't necessary because it's just as easy to send checks thru the mail. Where did the Federal government get the trillion$ of dollars to fund 3+ rounds of so called 'stimulus checks' associated with the CV19 situation? From a process that prints dollar values on checks and then mails them. That's all.

Questions to ponder: Which of the above is credit money and which is cash money? Which ones are most likely to result in higher prices of goods and services?