The Wall Street Journal reports that Kansas City Fed President Esther George renewed her attack on the central bank’s aggressively easy monetary policy, saying the institution should start cutting its bond-buying stimulus.
“The benefits of quantivative easing have been quite small, and the potential costs of the program grow each month as we buy those assets,” Ms. George said Thursday.
It would be important to start now tapering the bond buying program,slowly "to allow markets time to adjust, to recognize this is likely to be a long process in terms of unwinding” the bond purchases.
Ms. George has feared for some time that Fed bond buying is creating risks of a future inflation surge. She also worries that the bond buying, which is designed to lower the unemployment rate and boost growth, will create new bubbles in financial markets".
