Something to keep in mind

I have to take the housing implosion in small parts because there's a ton of moving parts. Here is something to keep in mind though:

The Fed is focused on inflation (producer prices were up over 1% in February, CPI was up more than expected as well). They are going to be in something of a quandary because if they raise interest rates to quell inflation, they are going to put the hurt on anyone with an adjustable mortgage, and could really drown those with exploding ARM's. Will they focus on homeowners or stable prices?

I suspect that the housing debacle may take care of those inflation fears all on its own.