Big banks are government-backed: Fed's Hoenig

Hoenig has historically been the lone Fed governor who isn't afraid to speak the truth on the fictional solvency of banks.  Too bad he is retiring in October.  Like Volcker <click here>, the former hawkish Fed Chairman who recently stepped down as Obama's economic adviser (something I predicted when he was appointed), Hoenig's retirement augurs in a fresh round of "stimulus" spending which will ultimately further drown the US in debt and cause the collapse of the global financial system.  Welcome to Amerika. 

http://ca.news.yahoo.com/big-banks-government-backed-feds-hoenig-20110412-112137-434.html

Hoenig Says Lower And Middle Classes Pay "Dear Price" For Fed Mistakes, Accuses Fed Of Commodity Price Inflation

Good timing on Fed governor Hoenig's part:  he speaks the truth as he is about to retire.


http://www.zerohedge.com/article/hoenig-says-lower-and-middle-classes-pay-dear-price-fed-mistakes-accuses-fed-commodity-price

"While some of the increase may reflect global supply and demand conditions, at least some of the increase is driven by highly accommodative monetary policies in the United States and other economies."

For those terrified by the ravages of deflation: "I tracked the average growth of money and the price levels in the United States from the 19th century to the present (Chart 3). It should surprise no one that there is a striking parallel between the long-run growth of money and the growth in the price-level index. From the end of World War II alone, the price index has increased by a factor of ten. With such a track record, it is hard to accept that deflation should be the world’s dominant concern."


"Central bankers must look to the long run. If current policy remains in place, we almost certainly will stimulate the growth of asset values and inflation. This may temporarily increase GDP and employment, but in the long run, we risk instability, damaging inflation and lost jobs, which is a dear price for middle and lower income citizens to pay."

And Wow: Fed's Hoenig Says United States Has "Deeply Undermined Free-Market Capitalism"

Too bad Hoenig is stepping down as Kansas City Fed governor soon.


http://www.zerohedge.com/article/and-wow-feds-hoenig-says-united-states-has-deeply-undermined-free-market-capitalism

The Fed mutiny has arrived:

• HOENIG SAYS U.S. HAS `DEEPLY' UNDERMINED FREE-MARKET CAPITALISM
• HOENIG WARNS OF ESCALATING SERIES OF CRISES WITH RISING COSTS
• HOENIG: LARGE FINANCIAL FIRMS CAN EXPECT BAILOUTS IN FUTURE
• HOENIG SAYS BIG FINANCIAL FIRMS MUST NOT HOLD ECONOMY `HOSTAGE'
• HOENIG: LARGE FIRMS WERE `GAMING' CAPITAL STANDARDS PRE-CRISIS
• HOENIG:BIG FIRMS `HAVE SIGNIFICANT INCENTIVES' TO INCREASE RISK
• HOENIG: TOO-BIG-TO-FAIL FIRMS POSE `GREATEST RISK' TO ECONOMY
• HOENIG SAYS BIG FINANCIAL FIRMS ENJOY `HUGE' FUNDING ADVANTAGE

And the last one:

• FED'S HOENIG SAYS `HISTORY IS ON MY SIDE'

Step. away. from. the. bathtub. Tom.
In other news, someone at the top finally tells the truth about this shitshow of a banana republic.

Paul Farrell: "Fed Dictator Bernanke Needs To Be Toppled"

http://www.zerohedge.com/article/paul-farrell-fed-dictator-bernanke-needs-be-toppled

Fed President agrees on debt crisis

Thanks to Kathleen for finding this short article.

WASHINGTON (MarketWatch) -- U.S. fiscal policy is on an "unsustainable course" and the government must adjust its spending and tax programs or risk a crisis, Kansas City Federal Reserve Bank President Thomas Hoenig said Tuesday. In remarks prepared for delivery to a conference about the budget, Hoenig also said the current outlook for fiscal policy poses a threat to the Fed's ability to achieve price stability and long-term growth. It's therefore a threat to the Fed's independence, Hoenig said.