Fears of another financial crisis are now looming large on the US economy, as the Federal Reserve Vice Chairman Stanley Fischer, on Sunday, expressed his concern over the “lacking control” of the Central Bank on market processes.
During the annual meeting of the American Economic Association (AEA) in San Francisco, on Sunday, Fischer reportedly said that the bank may not be able to even prevent another financial crisis. The Chairman said that, unlike in many other big economies of the world, the Central Bank in the US had no control over the housing market or other important assets. There is absence of proper regulatory powers vested in the Fed, he said.
He even took upon the Congress, pointing out the restrictions imposed on the Federal Reserve to have its say in the crisis situation.
“We won’t know until it’s very late. That’s something we have to worry about a great deal,” he stated.
The statement indicated that the policies framed and exercised by the Central Bank needed to undergo a change. He stressed that the policies need to be primarily based on money management, in order to prevent the financial crisis.