To follow up on the above, the natural answer is that the Fed will "print" money to cover these losses because this is what they always do.

Bond prices are plunging due to inflation fears. If printing ratchets inflation fears, the Fed's action will drive interest rates even higher, lower stock prices even more, and worsen things.

This is a different cycle—an inflation cycle. One has to be very careful when applying the answers of the disinflation/deflation cycle to an inflation cycle.

Remember when several banks blew up in March 2023, highlighted by Silicon Valley Bank? Not only did the Fed not print, but they kept hiking rates right through it. They correctly understood that massive easing into an inflation concern would just tank markets.

Do we have the same issue today?