Increases in inflation are always caused by a supply/demand imbalance. If demand goes up without a commensurate increase in supply, prices rise. But if supply drops without a corresponding decrease in demand, prices also will rise.
I think the Democrats & the Fed are shooting at the wrong target . They’re acting as if the issue is increased demand. This is likely to support their narrative that the economy is good & strong - it’s not. Global supply is down. A natural curtailing of demand would normally follow. BUT, the Fed has been pumping the money supply, and the Dems are passing massive spending bills, keeping the supply of “helicopter” money falling into the economy. THIS is what is artificially stimulating demand and causing inflation.
The alternative is to crash the economy into a recession or depression. The Dems won’t stand for this mere months before the mid-term elections.
The increase in interest rates is exactly the wrong thing to do. Just when you need corporations to EXPAND production and INCREASE supplies, they raise interest rates - reducing motivation and incentive to do so. Raising rates won’t do anything but make the inevitable crash larger and more impactful.
The lesson? Government interference in free markets never ends well. At least for those outside of government.
Supply chain issues are not the Feds fault—but it is not a problem they can fix either.
These days nobody wants to stand up and tell the truth, the whole truth, and nothing but the truth.