Credit vs Cash Money

The world's a nicer place in my beautiful balloon
It wears a nicer face in my beautiful balloon
--5th Dimension

There are two types of fiat money. Credit money is created when a bank or similar entity loans funds. It 'mints' money for the debtor, but the money is not free and clear. The loan must be paid back. Thus, the inflation caused by the credit money's creation reverses to a deflationary event when the loan is retired (or defaulted on). Credit money is ultimately deflationary.

Cash money is created by a government agency (e.g., Treasury) or associated authority (e.g., Fed) that produces cash money in either physical form using a printing press or using a mouse click in electronic account. Because money created in this manner is not linked to a liability, it is far more durable and more difficult to extract from the system. Cash money is ultimately inflationary.