In a speech yesterday, Dallas Federal Reserve president Richard Fisher said the Fed’s done all it can do to spur job creation and that Congress has got to get its act together in dealing with deficits.
Fisher has been critical of the Fed’s buying of bonds to bolster the economy. In considering what steps should be taken next, he says an that end to this form of stimulus shouldn’t be a scary prospect for the government.
He likened developments in the Fed’s monetary policy to a Shakespearean play starring a “daring captain,” Fed Chairman Ben Bernanke, steering the ship of the U.S. economy.
“Act IV, just beginning, will involve the drama of introspection, with the FOMC evaluating the utility of its navigational tactics, and, perhaps, fine-tuning them, if not altering the course,” Fisher said, referring to the Fed’s policy-setting Federal Open Market Committee, in remarks prepared for delivery to the C.D. Howe Institute Directors’ Dinner in Toronto. Fisher is not a voting member of the committee this year.
Asked if he was concerned about the impact of rising bond yields on the economy, he said it should be monitored but that policymakers could not let markets dictate policy.
“We cannot live in fear that gee whiz, the market is going to be unhappy that we are not giving them more monetary cocaine,” he said.