Returning to a theme that's been popular with him, Federal Reserve Bank of Dallas President and CEO Richard W. Fisher, reiterated late Tuesday that monetary policy is solid and it is the obstacle to prosperity is the federal government.
"It is my firm belief that the fault in our economy lies not in monetary policy but in a 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," Fisher told the Financial Executives International, according to prepared text released by the Fed.
"One is hard pressed to argue that there is much efficacy derived from additional expansion of the Fed's balance sheet," he said. "This is why I've been such a strong proponent of dialing back our large-scale asset purchases."
While monetary policy is needed to allow businesses the opportunity to create jobs, Fisher said, "the store of bank reserves awaiting discharge into the economy through our banking system is vast, yet it lies fallow."
Reserves of depository institutions are at $2.5 trillion, compared to $43 billion before the financial crisis, Fisher noted. "There is plenty of money available for businesses to work with."
