Posted on 01/03/2022 4:12:43 AM PST by EBH
The historical record shows that Hoenig was worried primarily that the Fed was taking a risky path that would deepen income inequality, stoke dangerous asset bubbles and enrich the biggest banks over everyone else. He also warned that it would suck the Fed into a money-printing quagmire that the central bank would not be able to escape without destabilizing the entire financial system.
...The Fed is now in a vise. Inflation is rising faster than the Fed believed it would even a few months ago, with higher prices for gas, goods and automobiles being fueled by the Fed’s unprecedented money printing programs. This comes after years of the Fed steadily pumping up the price of assets like stocks and bonds through its zero-percent interest rates and quantitative easing during and after Hoenig’s time on the FOMC. To respond to rising inflation, the Fed has signaled that it will start hiking interest rates next year. But if that happens, there is every reason to expect that it will cause stock and bond markets to fall, perhaps precipitously, or even cause a recession.
...The last time America suffered a long and uncontrolled period of inflation, Thomas Hoenig was given the miserable job of cleaning up the mess it left behind. This was the period that has come to be known as the Great Inflation.... Hoeing came to realize that the institution he worked for, the Federal Reserve, wasn’t just a bystander to this inflation. It had helped create it.
...Hoenig’s 2020 paper didn’t get much attention. After his retirement from the Fed, he served as stint as vice chairman of the FDIC, where he pushed an unsuccessful proposal to break up the big banks.
(Excerpt) Read more at politico.com ...
Also it is interesting Hoenig too, has recently resigned from the FDIC. And here we are with Federal Deposit Insurance Corp. (FDIC) Chairman Jelena McWilliams, a Trump appointee, resigned Friday amid a power struggle with Democratic members of the agency’s board. So, if his paper to the FED was 2020 and his stint as Vice Chair FDIC, seems to indicate the two people with what was left of commonsense have vacated their employment within the last year.
This ultimately demonstrates that they are hellbent on destroying the US economy and ultimately the world economy.
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FDIC chair resigns after warning Democrats launching ‘hostile takeover’......
Fox News ^ | 2/2/2022 | Timothy H.J. Nerozzi
Posted on 1/2/2022, 7:33:04 AM by caww
FDIC Chairman Jelena McWilliams announced her resignation Friday in an open letter addressed to President Biden, just weeks ‘after’ she warned of a “hostile takeover” of the agency by Democrats.
McWilliams was appointed to the position in 2018 under former President Trump. Her resignation will be effective Feb. 4.
McWilliams wrote in her op-ed. “Never before has a majority of the board attempted to circumvent the chairman to pursue their own agenda.”..”This conflict isn’t about bank mergers. If it were, board members would have been willing to work with me and the FDIC staff rather than attempt a hostile takeover of the FDIC internal processes, staff and board agenda.”
(Excerpt) Read more at foxnews.com ...
Raise the interest rate to 15% to match the $15. minimum wage so some of us old people with saving can make some interest.
I have a feeling, pardon my feeling, that a fifteen percent interest rate would sink the federal reserve, since we just happen to be paying interest on that debt. That in turn would sink the economy.
Prolific money printing IS inflation.
I do believe that’s what Hoenig is saying or was saying...
To respond to rising inflation, the Fed has signaled that it will start hiking interest rates next year. But if that happens, there is every reason to expect that it will cause stock and bond markets to fall, perhaps precipitously, or even cause a recession. >>>Hoenig was given the miserable job of cleaning up the mess it left behind.
It's the demoralizing times like these when you just have to sit back and ask,
"Did somebody just say 'Honey'"!?
Every time a bell rings an angel gets his wings.
I always thought the fed would produce inflation so it could payoff the massive debt with cheaper dollars. But they continue to print so that theory is no longer is tenable.
The controlled demolition of the system in order to switch to digital currency and social control as the pandemic wanes. Get ready for stage 2 launch.
I read over the article and much of it is what has happened before Biden.
However yes he seems to be saying over-printing if money is the cause, and that I think has shot up under Biden, correct?
This ultimately demonstrates that they are hellbent on destroying the US economy and ultimately the world economy.
YES. This has been the goal of the Commie left for years. They are so close they can taste it.
I haven’t followed it the best, but I think Biden’s paying out more in stimulus payments and forcing businesses to match or go over that amount to get workers. There’s also the supply chain problems adding to it. —In the end I think Trump’s economy would have been better than Biden’s.
bmp
Just great - as if we needed more proof Biden's commies are working to wreck the economy...
Like Biden is going to care. He (or Obama, probably) is likely behind the hostile takeover. Are Republicans really this clueless? There has been a hostile takeover of this government since 2008, yet the GOP acts like everything is hunky-dory, and acts shocked when the Marxists show their true colors. Apparently, the GOP is truly the Stupid Party.
When the nation, a business, or a family shirk their responsibility to budget their affairs it generally means there is a moral breakdown somewhere.
The purpose of a budget for the government is to submit to the people's representatives in such a transparent way that the people's representatives votes on the allocation of resources as well as the imposition of taxes can be determined up or down by the electorate. When our government proceeds for decades on continuing resolutions, the system breaks down, representative democracy is frustrated, graft and corruption and crony capitalism thrive.
All of this is made possible by the practice of simply borrowing money without consideration of the long-term costs to society and certainly to the next generation. This power to borrow money is unique to postwar America as the world's superpower and reserve currency. This, coincidence of factors permits our government to print money almost at will, to receive funds from foreign countries because we are the reserve currency and the largest economy, to avoid inflation by the additional coincidence of cheap Chinese goods to import, cheap labor to import keeping domestic wages down, and the digital revolution keeping costs overall down.
For the time being there seems to be no present-day economic consequences to running up a staggering debt of $22 trillion. There are no political consequences for doing so and there will be no political consequences so long as there is no pain. Indeed, the political consequences run the other way because those who complain about overspending tend to lose elections. Those who promised to keep the music playing tend to win elections.
“Over printing of money” is inflation. It is the cause of nominally higher prices. Higher prices are not inflation. Higher prices are caused by inflation. Perhaps it is a quibble but if we do not get our terms straight then it is hard to understand just what it is.
Right again. Radical change is as inexorably certain as death. When the voters might ultimately bring that change down upon themselves will almost certainly be in the wake of real social disintegration or at least a very painful financial episode. We have exchanged thoughts, or least I have visited my thoughts upon you, concerning the artificial world in which we currently exist, a world of scarcity which falsely appears to us to be a world of abundance because of the peculiar position of the United States as a superpower, the world's largest economy, the world's reserve currency, culminating in an ability to borrow almost into infinity without immediate symptoms of inflation because of the very cheap labor coming from globalization and immigration and abundant cheap goods coming from ultimately lethal trade practices.
I think the problem is deeper than politicians validating open borders and free trade, in fact, I no longer think it is productive to blame politicians for doing what politicians do any more than it is sensible to blame scorpions for behaving like scorpions. Why? Because I believe that the people ultimately get what they want and, biblically, what they deserve. A politician who does not pander to the short term clamors of the electorate no matter how foolhardy the consequences, will soon be out of business. The business of politicians is to be elected.
Whom then do we blame? The electorate? Are they to blame for not recognizing the bubble? Are they the blame for listening to the Pied Piper's of globalization, crony capitalism, social welfarism? Are they morally responsible for failing to internalize that the music cannot play on? Margaret Thatcher's axiom, socialism is great until you run out of other people's money, does not seem to apply to our immediate environment because so long as we can borrow $1 trillion a year there is no running out of money. Therefore, the politicians find themselves in a race to the bottom, if they do not pander to the short term desires of an electorate conditioned to live in this bubble, they are voted out of business in favor of the politician who will sell favors like the Mayflower Madam.
After all, the electorate is in a race to the bottom as well. If a manager of a capitalist enterprise does not go offshore, if he does not hire illegal immigrants, if he does not lobby the government to commit crony capitalism, he too will be out of business. Is the dead-end hamburger flipper to blame for turning to politics as the other door to an economic future slammed in his face?
Oh, the reckoning will surely come. The waves of globalization, immigration, automation, and trillion dollar deficits cannot go on so they will not go on.
The media being complicit with the over spending pols share the blame.
I think it is more along the lines of a democracy typically does not persevere beyond about 200 years. When an electorate realizes they can vote themselves the coffers...
You have a republic madam, if you can keep it.
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