One of the ongoing criticisms of the Federal Reserve is that, despite its expertise and mandate, it presided over the failing institutions and didn’t understand
“„“It is a striking irony to me that the outcome of the public anger directed toward Washington and Wall Street may lead to the further empowerment of both Washington and Wall Street in regulating financial institutions,” Hoenig said in the letter, written in response to lawmakers’ questions.
“„St. Louis Federal Reserve Bank President James Bullard told a business group that a plan for a multi-member financial system watchdog is unlikely to prevent a future crisis because it was unlikely to act decisively.
“„“I think that is a tragic mistake; it takes the eyes away from the Federal Reserve in knowing what’s going on in America.”
“„“As long as the Federal Reserve is responsible for discount-window lending, it makes no sense to diminish the Fed’s robust role in the supervision of a range of banking institutions, from large to small,” Lacker said today in remarks to the annual conference of the Institute of International Bankers in Washington.
“„I think we do a really good job of consumer protection, if you look at our record, especially since 2007,” Lacker said. “We acted very rapidly to emerging information about risks to consumers in mortgage lending,” Lacker said. “Plus, putting it with somebody who’s doing safety and soundness regulation makes sense to me.”