The Fed is at risk of being perceived as political, has overburdened itself with short-term tasks and is too sensitive to market moves, says Charles I. Plosser, former President and CEO of the Federal Reserve Bank of Philadelphia and member of the Federal Open Market Committee (FOMC). He argues that the reasons for keeping the balance sheet big seem dubious, and that there are some important governance issues too. Plosser is currently a visiting fellow at the Hoover Institution at Stanford University and a Public Governor of FINRA, the Financial Industry Regulatory Authority.
Charles Plosser spoke to Beat Siegenthaler of the UBS Knowledge Network in Frankfurt on Mar. 27.