Theodor de Bry’s 1590 engraving of Secoton, from John White’s watercolors. Public domain.
A deep recession in 1981 and 1982 brought inflation down, and unemployment went above 10 percent.
If money is tight, you are the person the rate hike was willing to idle.
If you are in the middle, a factory town can lose the shift even after your own loan is under control.
If you have savings, the inflation scare fades and the value of a bond bought at high rates looks brilliant later.
The recession ran from July 1981 to November 1982.
Unemployment rose above 10 percent.
Inflation, which had been in the double digits, broke, and that break is why Volcker's pain is remembered as a policy and not only as a slump.
Source: National Bureau of Economic Research, July 1981 to November 1982; Bureau of Labor Statistics, unemployment peak above 10 percent in 1982.