News

Dallas Federal Reserve president argues that Dodd-Frank won’t solve financial problems

Richard Fisher

Dallas Federal Reserve President Richard Fisher was critical of the Dodd-Frank Act on Wednesday, suggesting the break-up of America’s five largest banks and arguing that the Dodd-Frank is unlikely to solve any of the nation’s financial problems.

Fisher said that Dodd-Frank is “’well-intended’” but reiterated a previous message that the legislation will do little “to treat too-big-to-fail,” Fox News reports. He also voiced support for the Volcker Rule, a Dodd-Frank provision banning proprietary trading on behalf of financial institutions.

Also addressed, following the speech to a manufacturing group, was the potential for the Federal Reserve to send out a new stimulus effort, called QE3. Fisher said that QE3 is a “Wall Street fantasy,” and the likelihood of such an event is close to none, “unless there is some extreme crisis that none of us can presently foresee,” according to NASDAQ.

“In my view, it’s not going to happen,” Fisher said, NASDAQ reports.“It’s a fantasy. Wall Street keeps dangling QE3 out there [but] I just don’t see it happening.”

Fisher has been an outspoken critic of the Federal Reserve’s previous stimulus effort, QE2. In the aftermath of QE2, the Federal Reserve came under fire but has since, Fisher said, rebuilt its image. Fisher added that, given the outcome of QE2, the Federal Reserve would likely be unwilling to jeopardize their new image “unless it were glaringly necessary,” according to NASDAQ.

Comments are closed.