When borrowing becomes more expensive, people borrow less, which means they have less money to gamble on real estate and stocks and crypto, and less money to buy crap they don’t need at prices they can’t afford.

Increasing interest rates works when the cause of inflation is excessive demand, not supply issues. When corporate profits are way up and they are buying back their own stocks it is difficult to think that there is any need for price increases. They raise prices because they can and their shareholders need to see some steady-state in profits to rubber stamp CEO and management bonuses.

If we allow this entitled view to dominate our monetary/economic system it will mean that the traditional rate hikes to combat inflation will, instead, spur more profit taking to protect investors in a climate that can't generate sufficient sales volumes due to supply shocks that have never been resolved because that would require more investment in infrastructure, which no one has an appetite for currently, private or public.

Biden is bragging up the reduced deficit, meaning less money in the economy to purchase critical resources. He knows better, but the base voters of both parties can't get past the word "debt" to realize that the government's red ink is our only source of net black ink in the private sector. Where is the deficit going to go when the rate hikes put more people out of work and reliant upon automatic stabilizers in the safety net?

What we are seeing is the investment class, which has successfully taken back control of the country after the brief New Deal gains made by the working class, throwing a hissy fit because they have to pay workers a livable wage for the first time in decades. Don't look for this to be fixed by a captured Fed or a neoliberal market worshiping President and his corrupt henchmen in Congress. If we had an option that was better I'd say vote for the opposition, but we don't. We may get the revolution, as misguided and inept as it was, that started Jan 6th, 2021.