Former Kansas City Fed President Thomas Hoenig: 'Certainly interest rates should not be lowered'

• The Federal Reserve transition is characterized by significant 'turmoil,' with incoming nominees like Kevin Warsh expected to face intense questioning on monetary policy and inflation.
• Hoenig asserts that interest rates 'should not be lowered' because the economy is experiencing an 'inflationary boom' with real interest rates below 1%.
• He points to factors like favorable tax environments, strong government spending, new investments (e.g., in AI), robust corporate earnings, and an expanding Fed balance sheet as contributors to this inflationary pressure, warning against repeating past mistakes that led to 9% inflation.

Former Kansas City Fed President Thomas Hoenig discusses the turbulent Federal Reserve transition and current monetary policy. He strongly argues that interest rates should not be lowered, citing an 'inflationary boom' driven by strong economic conditions and government spending. Hoenig emphasizes the Fed's responsibility to control inflation, even if it means resisting calls for lower rates.