What does it mean to "monetize the deficit"? Why is it important in discussions of fiscal policy? Use an appropriate diagram to illustrate your answer

If the Fed wishes to keep interest rates low during a budget deficit, it must create money to expand the supply. While interest rates increase the effectiveness of fiscal policy (a greater impact on GDP), there is also a danger that the increase in money will trigger inflation. Although the Fed has not monetized much debt, there is always the danger that a central bank will do so under pressure from elected politicians. Latin America and Russia provide examples of what monetization can lead to. The diagrams illustrating the effects of monetization should resemble Figure 16-8 in the text, showing the effects on the economy of an increasing money supply.