Fed officials warn on bubbles but Bernanke cautious | Reuters: "Two top U.S. Federal Reserve officials warned about the risks to the economy from asset bubbles on Wednesday, and one suggested raising interest rates to halt risky behavior that could trigger another bust.
Still, Fed Chairman Ben Bernanke offered a relatively downbeat view of the economy during a speech in Dallas, suggesting he was in no rush to tighten monetary policy.
Thomas Hoenig, president of the Kansas City Fed, reiterated his concern that the Fed's ultra-low interest rate policies could have unintended consequences.
'I am confident that holding rates down at artificially low levels over extended periods encourages bubbles, because it encourages debt over equity and consumption over savings,' Kansas City Federal Reserve Bank President Thomas Hoenig told a business group."
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