Howard Pyle, The Burning of Jamestown, an early-twentieth-century illustration, not an eyewitness view. Public domain.
By 1980 and 1981, short-term interest rates were near 20 percent.
If money is tight, you do not borrow unless the alternative is worse, and sometimes you borrow anyway.
If you are in the middle, buying a house in this market is an act of nerve or of refusal.
If you have savings, a money-market account finally pays, which is the point of the squeeze.
The Federal Reserve's campaign pushed the cost of short-term money to about 20 percent.
Households met that number in car loans, credit cards, and mortgages.
Inflation was the enemy, and the payment was the weapon.
Source: Federal Reserve, policy rates of 1980-1981.