Dallas Fed president Richard Fisher is retiring in March, so now it's time for him to really let his hair down.
In a speech on Wednesday, Fisher takes dead aim at a Congressional push that continues to be a thorn in the Fed's side: calls to audit the Fed.
The latest call for auditing the Fed is from Senate Bill 264, which calls for a full audit of the Federal Reserve and is sponsored by Senator Rand Paul (R-Kentucky).
Fisher says of those in support of this bill:
My suspicion is that many of those in Congress calling for 'auditing' the Fed are really sheep in wolves’ clothing. Having proven themselves unable to cobble together with colleagues a working fiscal policy or to construct a regulatory regime that incentivizes rather than discourages investment and job creation — in other words, failed at their own job — they simply find it convenient to create a bogeyman out of an entity that does its job efficiently.
Senate Bill 264 calls for a full audit of the Fed, but in his speech Fisher says, "The operations and finances of the Board of Governors and the 12 Federal Reserve banks are already audited up the wazoo."
A push to audit the Fed from members of Congress isn't exactly new. It was a topic of discussion during the 2012 Presidential election and with Paul — a 2016 Presidential hopeful — sponsoring the most recent Senate bill, calls for auditing the Fed are likely to be a talking point during the upcoming election cycle.
In his speech, Fisher argues for the necessity of the Fed maintaining its independence from political machinations, attributing the failure of the Weimar Republic to meddling in monetary policy from German politicians.
The Weimar Republic was in power in Germany following World War I and suffered through one of the most notorious periods of hyperinflation in the early 1920s.
Fisher said, "We know that when the German central bank gave into political considerations, the result was the Weimar hyperinflation and its eventual consequences."
With a final comment on the 'Audit the Fed' movement, Fisher said:
'Audit the Fed' is nothing more than an attempt to override purely economic judgments and bend monetary policy to the will of politicians. It is misguided. I pray we don’t go there. I can think of nothing that would do more damage to our nation’s prosperity.
Read Fisher's whole speech here »
(via Matt Boesler)
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