Monarch's state? Not good, it's true (7)
I believe the answer is:
reality
'monarch's state?' is the definition.
'reality' can be an answer for 'state?' (reality is a kind of state). I am not certain of the 'monarch's' bit.
'not good it's true' is the wordplay.
I cannot really see how this works, but
'it's' could be 'it' (I've seen this in other clues) and 'it' is found within the answer.
'true' could be 'real' ('real' can be similar in meaning to 'true') and 'real' is found within the answer.
A single letter 'y' remains which might be clued in a way I don't understand.
This may be the basis of clue (or it may be nonsense).
Can you help me to learn more?
(Other definitions for reality that I've seen before include "as some TV programmes purport to show" , "Verisimilitude" , "State of things as they actually exist" , "The way things are, no illusions" , "Truth, actuality" .)