Inflation, cause or result of monetary emission? The argentine economist Fernanda Vallejos, while trying to protect the government because of the inflation, the following:


  Inflation is not the result but the cause of monetary emission. As
  there's inflation (because of other reasons not important here),
  people need more money and the central bank needs to print more money.


How can you argue against that?  As it seems to be the opposite of modern theory on inflation.

Context: This is in Argentina, where it has an important deficit, monetary emission and inflation are around 40%.
The problematic part of the statement, is the "because of other reasons not important here" part . In other words: "ignore general equilibrium" -which is an unacceptable statement to make when discussing government policy and actions.  

Consider the naive quantity theory of money:

$$PQ = VM \tag{1}$$
$P$ is the price level, $Q$ is output produced (measured in quantity), $M$ is money supply, and $V$ is "velocity of money", an indicator of the "transactions technology" in the economy, how fast money circulates around to settle transactions.  

Assume now that we are talking for a "small" country that needs to import basic factors of production like raw materials or energy. "Small" here means "with no market power". Such a country is a price-taker in the international market. More over, substitution possibilities for these factors are usually small to non-existent.

Competitive markets or not, the economy's output will be distributed to factors of production and for our purposes, it doesn't matter whether there will be "capital rents" and "profits", or only capital rents. Use for convenience three factors of production and write

$$PQ = rK + wL + p_fE \tag {2}$$

where $r$ and $w$ are nominal, and $p_fE$ is the nominal cost of imported factors. Denote $s_f$ the foreign exchange rate (units of local currency per one unit of foreign currency), $c_f$ the price of the imported factors in foreign currency, so $p_f = c_fs_f$.
Use this and substitute $(2)$ in $(1)$

$$rK + wL +c_fs_fE= VM \tag{3}$$

If something happens to the international market and $c_f$ goes up to $c_f' &gt; c_f$, this will tend to increase the left hand side. This "something" in the international production factors market does not relate to the level of domestic output $Q$, or to domestic money transactions technology, $V$. More over, at least in the short run, factor substitutions will not happen, wages do not move that easily, and firms will maintain their output level while increasing selling prices, to cover the increased production costs. And since the reasons for the increase affect more-or less the whole economy, it is not that likely that competition will stop firms from doing so: they all want to cover their increased costs, they all know that the cost-rise is general and comes from abroad, so they don't need to actually collude in order to sustain a price increase. "Common knowledge" suffices.  

So in order to preserve the equality in $(3)$ it appears that we must have

$$rK + wL +c_f's_fE = VM',  \;\; M' &gt; M\tag{3}$$

You see? This is the phenomenon called "imported inflation". Whatever the reasons were for the price increase (the "not important" reasons), inflation was not caused by the expansion of the money supply (that's indeed true), and what else the government could do than raise the money supply to service the higher nominal level of output?

Of course what the story above does not say, is that foreign factors of production will want a "money" that they accept, and most likely this won't be the local currency of this small country. And by increasing the money supply the exchange rate $s_f$ will suffer (increase), because $s_f = h(M), \;\; h' &gt;0$, increasing in this way further the costs of imported factors in terms of local currency, and making the increase in the money supply equivalent to "shoot oneself in the foot". And this is only one more step towards the road to general equilibrium.

The essence here is that
a) it is trivial that there are many other factors that may tend to affect prices upwardly, except money supply expansion  

b) in the presence of these other influences, increasing the money supply is not necessarily the appropriate government response.