Howard Pyle, The Burning of Jamestown, an early-twentieth-century illustration, not an eyewitness view. Public domain.
Paul Volcker let interest rates jump in order to stop inflation.
If money is tight, a credit card or a car loan can become the thing that breaks the month.
If you are in the middle, a mortgage you have to take this year is a different object from one you already have.
If you have savings, you are finally paid to hold cash, and you may also own a business that cannot borrow.
President Carter appointed Paul Volcker to chair the Federal Reserve in August 1979.
On October 6, Volcker changed how the Fed operated and allowed short-term rates to rise as far as the fight required.
The target was inflation, and the tool was expensive money.
Source: Federal Reserve history, Volcker appointment, August 1979, and the October 6, 1979 operating change.