This is Richard Fisher, President of Federal Reserve Bank of Dallas:
“We have made rich people richer,” Fisher told CNBC today. “The question is, what have we done for the working men and women of America?”
Fisher was one of the earliest and most outspoken advocates of winding down the bond-buying program…
I had to read the comment a couple of times to make sure that I understood correctly. Fisher actually claims that the fed should scale back monetary easing because it is not doing anything for the “working men and women of America”.
Fisher’s comments are truly bizarre. Most wealthy Americans are still very wealthy (I have no problem with that) – crisis or not – but it is pretty clear that the overly tight monetary policies in the US over the past fives years has been the main cause of the significant increase in US unemployment and in that sense been a massive assault on the “working men and women of America”.
If Richard Fisher seriously wants to do you something for the “working men and women” then he should come out and support to bring back the level of nominal GDP to the pre-crisis trend level. That undoubtedly would be the best “employment policy” anybody could come up with in the present situation. However, I suspect that Fisher is just coming up with random arguments for opposing monetary easing rather than truly caring about the “working men and women of America”. I am not impressed…
PS I am certainly not claiming to be speaking on behalf of the “working men and women of America” – I just find ludicrous when somebody actually in a position to do something for these people through his actions (opposing monetary easing) is doing exactly the opposite.
PPS I don’t think it should be the job of central banks to hit a certain “employment level” or any other real variable and I find the fed’s “dual mandate” seriously flawed, but it is certainly not the job of central banks to “destroy jobs” either. A proper NGDP level targeting regime will provide the best nominal framework for letting the labour market work in a proper and undistorted way and as such would indirectly ensure the highest level of employment given the structures of the economy.
PPPS I wrote this on a flight to Stockholm. I had been thinking about writing something about Swedish monetary policy or Africa (the topic I will be speaking about in Stockholm today), but you can all blame Richard Fisher for distracting me.