Richard Fisher is no fan of QE3, and he's worried that his colleagues at the Fed have developed an unquenchable, $85 billion-a-month habit. Much as he finds their addiction abhorrent, he isn't ready to abandon them to their fate—runaway inflation and the eventual loss of their teeth. So he's pushing a 12-step program. First, admit you have a problem. Second, stop buying MBS.
Dallas Fed President Richard Fisher says that if the Federal Reserve is to taper the purchases of assets, it should do so first with mortgage-backed securities. Speaking on CNBC, Fisher added there practical limits to growing the balance sheet.
Compassionate though he is towards the junkies, he's got no time for the "fiscal authorities" who have pushed his fellow Fed presidents and governors to this abase themselves so. And it appears he does not include the Fed itself in the roster of "fiscal authorities."
Mr. Fisher, who isn’t a voting member of the central bank’s policy-setting committee, also reiterated that inflation is still not a concern and again pointed blame for the lack of job creation at “fiscal authorities” and the lack of clarity on a range of issue, including taxes, health care and regulation.
“The fault lies with the fiscal authorities, and until they get their act together — give us some certainty — I don’t think you’re going to see the kind of growth we would like to see.” The U.S., he said, nonetheless is “the best-looking horse in the glue factory.”