The Wall Street Journal reports, "Federal Reserve Bank of Dallas President Richard Fisher reiterated his support Friday for the central bank’s effort to wind down its bond-buying stimulus program".
“One is hard pressed to argue that there is much efficacy derived from additional expansion of the Fed’s balance sheet,” Mr. Fisher said in the text of a speech prepared for delivery in Austin, Texas. “This is why I’ve been such a strong proponent of dialing back our large-scale asset purchases and will continue advocating that we do so.”
Late last month, the Fed cut the pace of monthly bond buying to $65 billion from $75 billion. It is expected to continue to cut the pace of purchases and end the buying later this year. Mr. Fisher has long opposed the bond-buying program.
“There is abundant liquidity outside the banking system.” “We don’t need to add more to it” at a time where the amount of cash in the system outstrips demand in the form of loans. “I’ll continue to advocate for ending, as soon as practical, the large-scale asset purchases,” he said, although he added the pace of the wind-down would depend on the economy.
Mr. Fisher again blamed much of the current troubles on Congress.
“It is my firm belief that the fault in our economy lies not in monetary policy but in a reckless and feckless federal government that simply cannot get its fiscal and regulatory policy geared so as to encourage business to take the copious amount of money we at the Fed have created and put it to work creating jobs and growing our economy,” Mr. Fisher said. He added, “fiscal policy is not only ‘not an ally of U.S. growth,’ it is its enemy.”
