An interest rate hike is the best thing we could have. It would cause a short burp in the economy, but - like the interest rate hike of Reagan and Volcker back in 1982 - it would kill inflation (which is running closer to 8% like it was for most of the Carter Administration) and get the economy moving again.
Lower inflation, cut the M0 growth to increase the value of each dollar, that will stabilize the GDP and promote investment. Bump interest rates please!
I agree, except a quarter of a percent move will do squat to stop inflation. They are rather stuck. To fight inflation they need serious rate hikes, but that in turn will do a real number on the economy. There is no way most mortgage holders could survive 4 to 8% in hikes.