The Fed is stuck.   If they raise rates, that will make it harder for people to pay on their debts, you will have cascading defaults in the system, and people likewise dump the dollar.  If they lower rates, that will cause more people to dump the dollar because of inflation, make it harder for people to pay on their debts, and cause cascading defaults.  As in, they can have a currency crises followed by a great depression, or a great depression followed by a currency crises.   Gee, it's almost as if maybe those fuckers shouldn't be in the business of printing up money and loaning it out to begin with.  Gee, it's almost as if the market can allocate capital better than a cartel of assholes appointed by the government.