yes, federal reserve monetary policy is much more focused on the supply side of money (m2,m3,m4) - making sure banks are well capitalized and can lend to one an

yes, federal reserve monetary policy is much more focused on the supply side of money (m2,m3,m4) - making sure banks are well capitalized and can lend to one another smoothly in order to make loans and keep liquidity high - but this doesn't get directly translated into inflation because a lot of the "printed" liquidity isn't directly circulating in the economy (low velocity) government fiscal policy has a much more direct effect on m0, m1 through stimulus and other direct lending and spending efforts, which have a high velocity and directly impact inflation now...what happens if the assets on the feds balance sheet start to default?