Yeah, that sucked.And I remember paying on a bank loan 1/2 % over prime I was paying for a while 17%The horrible inflation of the 70s began before Carter. Remember WIN? I don't know how old you are.Carter's double digit inflation plunged us into a recession. Reagan reversed his policies and gave us an economic expansion that created 20 million jobs and made us oil independent.
Nixon had two years of double-digit inflation.
As for Reagan, the 1981 recession was caused by allowing Volker to float interest rates for the first time ever. Carter was the one who gave the green light, Reagan carried it through.
This was Volcker's plan to finally get the 12 long years of inflation under control. And it worked. Volcker allowed the Fed funds rate to go all the way to 18 percent. This caused the recession.
Reagan was put under tremendous pressure to lower the funds rate because unemployment was rising, but he stuck to his guns and the inflation fever finally broke. That took balls.
See: "Volcker Shock"
From there, our economy blasted off. Reagan has always been my hero.
If you bought Treasuries in the early 80s, you made out like a bandit. I remember my savings account paid an interest rate of 12 percent!
The whole reason Volcker floated interest rates is because banks were going under. They had loaned out money at low interest, and then inflation took off and they were upside down. They were collecting less interest than the inflation rate. They had to pay their depositors a higher interest rate than what they were charging their legacy borrowers.
So off we went. You borrowed at 17 percent, and the banks paid depositors 12 percent. The universe returned to harmony.