Friday, August 13, 2010
Can interest remain low?
11:56 AM ET - Thomas Hoenig, Kansas City Fed President, states that zero interest rates were a "dangerous gamble" in a period of moderate growth. In a speech in Lincoln, NE, Hoenig warned that Fed Chairman Ben Bernanke and his allies were trying to use monetary policy as a "cure-all" for "every problem faced by the United States today." Keeping rates too low for too long will only lead to a repeat of the cycle of severe recession and unemployment in a few short years, he warned. Hoenig has dissented at every Fed policy meeting this year.