The Surest Bet Is The Continued Debasement Of Our Money | Tom Hoenig, Former FOMC Member

**SPEAKER_1** (0:00)
So good, so good, so good.

**SPEAKER_2** (0:03)
Everything you want for summer is at Nordstrom Rack Stores now, and up to 60 percent off. Stock up and save on the brands you love like Vince, Sam Edelman, Frame, and Free People. Join the Nordy Club to unlock exclusive discounts, shop new arrivals first, and more. Plus, buy online and pick up at your favorite rack store for free. Great brands, great prices. That's why you rack.

**SPEAKER_3** (0:27)
You said this place was steps from the water.

**SPEAKER_4** (0:29)
We just haven't found the steps yet.

**SPEAKER_5** (0:32)
How much did we save?

**SPEAKER_3** (0:34)
Enough.

**SPEAKER_5** (0:36)
Enough to get lost?

**SPEAKER_6** (0:38)
Or you could book a stay with Hilton.

**SPEAKER_5** (0:40)
Welcome to your oceanfront room, just steps from the water.

**SPEAKER_6** (0:43)
The Hilton sale is on now. Book on hilton.com or the Hilton app and save up to 20 percent to get the stay you expected. When you want savings, not surprises, it matters where you stay. Hilton, for the stay.

**Thomas Hoenig** (0:58)
If you're printing money as a central bank, which the central bank is doing, to help fund the national debt and to help the banks have the ability to fund the national debt, and you're running international trade deficits, which allows the rest of the world to help fund your debt, you are going to inflate your way into an ever less valuable purchasing power of the dollar.

**Adam Taggart** (1:32)
Welcome to Thoughtful Money. I'm its founder and your host, Adam Taggart. What should we expect from the Federal Reserve as Kevin Warsh takes over as chairman this week? Given the inflationary oil price shock from the U.S.-Iran War, are rate cuts now off the table?
Are rate hikes possible ahead? For answers, we're incredibly fortunate to welcome back to the program, Dr. Thomas Hoenig, former CEO of the Kansas City Fed, former voting member of the Federal Open Markets Committee, a former director of the FDIC, and now a distinguished senior fellow at the Mercatus Center. Tom, thanks so much for joining us.

**Thomas Hoenig** (2:07)
Thanks for having me. It's always good to talk with you.

**Adam Taggart** (2:09)
You as well, Tom.
Tom, there's that old adage, never meet your heroes because they never meet your romanticized impression of them. Every so often, you come across somebody who breaks that rule. You're definitely one of them. I had the great fortune of meeting you in February at Stephanie Pombo and Grant Williams Conference in St. Petersburg, Florida. You were just the nicest man in addition to being one of the smartest guys around, Tom.

**Thomas Hoenig** (2:36)
Thanks. I'm glad to know I'm nice.
You're overstating my smartest guy in the room, but I do appreciate the compliment.

**Adam Taggart** (2:45)
Not at all. Pleasure to meet you. You're a pretty tall guy.
We had dinner one night and I think you and I are around the same height. What shocked me about spending more and more time in this macro space and meeting the various people I get to interview, is some reason there's a tall gene that just skews for this group. I mean, we're both around 6'2, or so, and we were some of the shorter guys at that conference.

**Thomas Hoenig** (3:10)
Yeah.
I find that I run into that more and more these days. So I don't know what it is, but it is interesting. It is notable when I talk with people around the country, as a matter of fact, they're in policy areas. So in fact, I just got back from a conference, I wasn't the shortest guy there, but I wasn't the tallest guy by any means, let me tell you.

**Adam Taggart** (3:35)
There's something in the water for the people who love macro for some reason. All right. Well, look, lots to talk about. Thanks so much for making the time. I know your schedule is very busy. So let's just roll up our sleeves and get right into it. So the baton is being passed to Kevin Warsh as chair of the Federal Reserve.
I'm curious to hear in general what your thoughts on a Kevin Warsh Federal Reserve are and in particular, let's start with this, what are the biggest challenges you see him facing as he steps into the chair and how do you expect him to tackle them?

**Thomas Hoenig** (4:14)
Well, he has some big challenges. There's no question about that. The first challenge will be what to do with interest rates at his first meeting in June.
I don't know where he's going to come out there because he will be under a lot of pressure, I suspect, to lower rates. That's all the President of the United States has been talking about. He, the President of the United States doesn't hesitate to tell the Chairman of the Fed what he wants.