[Rury]

It's not one or the other. People looking at this as it's more of a demand issue, or more of a supply issue aren't looking at things correctly. What matters is the ratio of demand/supply. If supply falls, and demand doesn't, this means there's too much demand for the supply, so saying it's caused by too much demand is as equally correct as saying it's caused by too little supply. It's the ratio what matters, not demand or supply alone.

For hyperbole, houses would never sell for millions of dollars, if only 2 dollars existed in the worldwide economy, not even if the housing shortage was so bad that there only was 1 house available in the entire world. People may try as they might, but they'd never get more than the total money in existence (2 dollars). Ergo it's entirely possible to make a money shortage worse than any "supply" shortage and force prices down. The Fed controls interest rates, and how many dollars exist, so they do have quite a bit of influence over the situation.

So, yes the Fed does have power to tame the current bout of inflation, but it takes time, and it is blunt. That said, there is a ceiling to how much money they can suck out of the economy, as they have little power to destroy dollars physically hoarded by people with no debt, or lost in a roadside ditch somewhere. But this doesn't matter much, as that money in practice, is out of the economy for the time being, as if it doesn't exist anyhow.