As a result at every moment of time the money supply function should be viewed as horizontal. Any increase in the nominal supply of money will always be demanded. Real interest rates are determined in the long run by real forces of productivity and thrift. Inflation is caused by an excess supply of money. Savings determines investment and so governs the rate of capital accumulation.
Inflation serves primarily to redistribute wealth between debtors and creditors.
Members of the economics profession, all the way from professors to students, are currently operating with a basically incorrect paradigm of the way modern banking systems operate and the causal connection between wages and prices, on the one hand, and monetary development on the other. Were it to attempt to do so, the liquidity of the banking system would be imperiled. Banks do not wait for excess reserves before providing new loans to the public. Nor are new loans made at the initiative of the banks themselves. Banks are essentially in the business of selling credit.