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Interview With Kansas City Fed's Thomas Hoenig

Wednesday, February 23, 2011 - 5:43 PM
MarketWatch has an interview with Thomas Hoenig, the lone dissenter at the FOMC last year. He's no longer a voting member.

Here's something that's worrisome. As Hoenig describes, the longer the Fed waits to start hiking rates, the harder it's going to be. That could push out the rate hikes even longer:
As you think about your moves, your increases, you are going to have more a shock effect on more things the longer you wait. And therefore it is going to be more difficult to do it.

Hoenig was never pushing for a tight monetary policy, just a move toward a more mild accommodative policy. Here is how he describes it:
If you took away [the extended period] language and you modestly brought interest rates back a little bit, it is still very accommodative policy, it is not tight policy.

Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
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