Fed’s Hoenig Says Operation Twist Risks New ‘Complexities’
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Federal Reserve Bank of Kansas City President Thomas Hoenig said the Fed’s plan to push down long-term interest rates may produce accidental outcomes and policy makers risk creating “imbalances” in the economy.
“I have real concerns about trying to fine-tune and micro-manage the economy when monetary policy is a blunt tool,” he said today in an interview with Bloomberg Radio’s “The Hays Advantage” with Kathleen Hays. Efforts to “redefine yield curves” may “introduce new complexities and risk new unintended consequences,” he said.