TINA-TAR: There Is No Alternative To A Recession?

The financial markets seem to have concluded that Fed Chair Jerome Powell has decided to go Volcker on us. During 1979-1981, then-Fed Chair Paul Volcker let interest rates soar to levels that caused a recession. He did so to bring inflation down (charts below).

During his press conference on Wednesday, Powell unambiguously reiterated the hawkish message of his Jackson Hole speech on August 26. In other words, he strongly suggested that the only way to bring inflation down is with a recession. He mentioned the words "pain" or "painful" seven times in his presser.