WASHINGTON — The nation's largest banks are a bigger threat than ever to the economy, Kansas City Federal Reserve Bank president Thomas Hoenig said Wednesday.
Repeating a favorite theme, Hoenig told the Women in Housing and Finance Group "history is on my side" in his view that "we must break up the largest banks."
"I am convinced that the existence of too-big-to-fail financial institutions poses the greatest risk to the U.S. economy," he said.
Hoenig dismissed the Dodd-Frank legislative constraints on banking, the promise that better bank supervision can restrain the risks, and the credit rating agency views that implicit government support can make the big banks better risks.
