LONDON — Dallas Federal Reserve President Richard Fisher has said that the Fed has already done enough to spark a robust economic recovery in the US and called on Congress to find a solution to the fiscal cliff as it was impacting consumer confidence and weighing on job creation.
"We've done enough... It's now up to those who created the unemployment problem to solve the unemployment problem. I believe that it's not monetary policy that's holding back employment," Fisher said in an interview with CNBC news.
"Businesses are ready to roll. They need final demand but most importantly what they need is clarity and the rules of the road and who do you turn to for that? You turn to the fiscal authorities," he added.
Fisher also said that there were limits to what monetary policy can do to stimulate the economy and warned Congress that it needs to find a proper solution to the fiscal cliff.
"Doing more, in my book, just encourages these people on the hill not to get their job done... We cannot substitute for a proper solution to the fiscal cliff. I hope there's not a single person in Congress who believes monetary policy can bail us out. There's a limit to our effectiveness," he said.
The Federal Open Market Committee member also said that recent economic data have shown that fears over the fiscal cliff are having an impact on consumer behavior.
"We're beginning to see now this fiscal imbroglio is really impacting consumer behavior. We've seen it in the last few data points. We need something that is more permanent, more convincing," he said.
Fisher also expressed concern that the Fed may not be able to leave its current balance sheet position.
"I argued that basically we were at risk of what I call a 'Hotel California' monetary policy. Where you can check out all you want but you can never leave. Theoretically, we can check out whenever we want from this program but practically with this rather engorged balance sheet we may never be able to leave this position," Fisher said.