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Kansas City Fed Head Thomas Hoenig Discusses The Federal Reserve's Exit Strategy (Video)

Still waiting on my flight, so here's another clip from CNBC's surprisingly excellent, morning broadcast.  Readers know that we've come to appreciate regional Federal Reserve President Thomas Hoenig's predilection for candor.  Though he was late to dissent, Hoenig has recently been showing his independence from B-52 in his continuing call to allow large banks to fail and fall into government receivership.

I'm comfortable with giving up the charade anytime now.  We're going to have to deal with Citigroup in an adult manner sometime in the next 12 months when they return looking for capital.  Their off-balance sheet issues alone are enough to kill them, let alone the morass they do keep on the books. 

So, it's refreshing to hear voices from Washington (Kansas City in reality, which could explain his forthrightness) that echo our belief (and yours) that certain failed institutions should actually be allowed to fail and their bondholders be asked to take the losses instead of taxpayers.  But that's an old rant which you've read many times before.  If only Bernanke, Geithner, Summers and Obama would listen.  Fat chance to expect those beholden to the banking oligarchy to change their stripes, yet I remain optimistic, almost every day.


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Reader Comments (6)

I don’t believe a word that the other Federal Reserve Presidents say going against Bernanke. Is Hoenig giving himself plausible deniability or does he want to look like a Johnny-come-lately? The answer is neither, it is important that the Fed appear to have independent voices in their effort to become the sole regulator of the future (Group of Thirty directives). Even the New York Fed gets its marching orders from governing bodies and men higher up in the food chain. The only transparency afforded to the US government is through Volcker and Geithner. Yes, bigger powers than Obama are grooming Summers for the Fed chairman position but the fact that he feels comfortable sleeping during key policy meetings should tell us otherwise. Again, the Group of Thirty wrote new manifesto on financial reform over a year ago and it clearly outlines how the central bank oligarchy that will not only make monetary policy going forward but also exclusively regulate their monetary policy. The real money is not in free checking accounts and home mortgage loan fees. The real money and power is in keeping nations of the world indebted to the owners of the central bank(s). If the US wanted to start fixing the banking problems, they would beef up their own internal auditing / forensic accounting departments like the FBI is trying to do. Unfortunately, they are hiring out of work investment bankers and not accountants.

How many of you run your own finances with an off-balance sheet company that loans you money, buys your debt, and issues its own debt when in need of a capital infusion?

I have yet to see one green shoot? Don’t tell me it is the equities market. That is a result of all the freshly printed money not an economic indicator of the world economy turning around.

There is a reason that the powerful remind the meek that they have control over their suffering.

I have another quote for you…

“To sit back hoping that someday, some way, someone will make things right is to go on feeding the crocodile, hoping he will eat you last -- but eat you he will.” Ronald Reagan
Jun 19, 2009 at 2:08 PM | Unregistered Commentergobias bluth
Jacob Tapper is just one of the many Obama plants. What is us with this guy? What a nudnik.
Jun 19, 2009 at 3:05 PM | Unregistered Commentergobias bluth
gobias, take heart. We've got a bumper crop of crocodile killers 'round these parts. Glad you're keeping a sharp eye on the swamps, though. We're usually pretty suspicious, too, even with people we like. You're in like-minded company.
Jun 19, 2009 at 3:06 PM | Unregistered CommenterJames H
Gators are in trouble up in GA. No gater' bait runnin' round these parts. We even have an open season for those suckers!
Jun 19, 2009 at 7:30 PM | Unregistered CommenterAin't Bullshittin'

LOL! I would have thought as much.
Jun 20, 2009 at 10:27 AM | Unregistered CommenterJames H

We agree with your sentiments. Well stated. The Fed might just implode in teh next few years politically, and that could be the beginning of the end.
Jun 23, 2009 at 1:00 AM | Registered CommenterDailyBail

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