Inflation does NOT reduce purchasing power if:

it remains under $10\%$ per year.

the Federal Reserve increases the money supply enough to offset it$.$

nominal wages rise at the same rate as prices.

prices of essential products, such as food and gasoline, don't increase too much.

Inflation does NOT reduce purchasing power if:

it remains under $10\%$ per year.

the Federal Reserve increases the money supply enough to offset it$.$

nominal wages rise at the same rate as prices.

prices of essential products, such as food and gasoline, don't increase too much.

Government debt is monetized when:

the Fed conducts open$-$market purchases.

the Fed sells Treasury bills in the bond market.

commercial banks buy newly issued Treasury bills.

the Fed transfers part of its financial reserves to the Treasury, which in turn buys Treasury bills back.