Inflation has several definitions, most based on either prices or money. The U.S.Federal Reserve has responded to rising prices with increases in interest rates. That is simple enough, but is the diagnosis that leads to such a treatment correct? Are rising prices the whole story? Over the past several decades, the U.S. economy has been operating at a peculiarly advantageous level, with imported products keeping prices low, international competition among the world’s workers keeping wages low and the Federal Reserve keeping the price of money low. Now comes the “rubber band effect,” in which historical economic patterns, having stretched for an extended period, begin to snap back to where they would have been had an aggressively pursued globalization model not interfered. Snapped-back rubber bands do not return to their original shape, and that will be true in this current time, as a new globalization takes shape. Prices have increased, the dollar’s value has increased, and lately, wages have increased while unemployment has decreased and job openings have increased. These kinds of statistics occur “normally” in an economy, but they rarely appear simultaneously. Something has changed structurally. These are unique times. The Fed’s rates, on their own, can address the cyclical side of these issues, but raising interest rates can only postpone or prolong the snapback effects of decades of constrained economic conditions.