Fisher
floats Fed changes to fix New York, Washington bias
Send a link to a friend
[February 11, 2015] NEW
YORK (Reuters) - The Federal Reserve should shuffle its policy-making
and bank-supervision rules to address perceptions of conflicts of
interest and regulatory capture in the power centers of New York and
Washington, an outspoken Fed official said on Wednesday.
|
Richard Fisher, addressing a New York audience for likely the last
time before stepping down next month as president of the Dallas Fed,
again warned against delaying an interest rate hike in the face of
weak inflation. But his most provocative remarks to economists here
criticized a central bank structure that he said "makes no sense."
Though they are unlikely to be taken up any time soon, Fisher
suggested three key changes: six of the 12 regional Fed presidents
should vote on monetary policy alongside six Fed governors in
Washington, with Chair Janet Yellen as tie-breaker, to "balance out
the division of power."
Second, the New York Fed's permanent vote on policy, due to its
president William Dudley's vice chairmanship of the Federal Open
Market Committee, should be rotated every two years among the
regional Fed banks to address "the appearance of a conflict of
interest."
Third, Fisher said, the "problem of regulatory capture" can be fixed
by transferring oversight of Wall Street banks to supervisors from
one of the other 11 district Fed banks.
[to top of second column] |
![](http://archives.lincolndailynews.com/2015/Feb/11/images/ads/current/graue_preowned_122114.png)
"I think we at the Fed must fully and frontally address the concern
of many who feel that too much power is concentrated in the New York
Fed," Fisher said in prepared remarks. "I understand the suspicions
that surround the New York Fed."
(Reporting by Jonathan Spicer; Editing by Chizu Nomiyama)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |