NEW YORK (Reuters) - Boston Federal Reserve President Eric Rosengren on Tuesday said his preference for mitigating volatility in money markets would be for the central bank to continue to maintain its bond portfolio at a sufficient size, as opposed to relaxing bank capital requirements.
And this:
In prepared remarks, Rosengren said the current level of the Fed’s policy interest rate is appropriate for the near term.
Rosengren voted against all three rate cuts made by the Fed this year and has repeatedly warned that lower rates could encourage excessive risk taking and over-leveraging, which could create more risks during a downturn. Rosengren will not have a vote in monetary policy decisions next year, but he will participate in deliberations.
OK, the repo mess was indicated by sudden jump in interest charges, and the Fed suppressed the rates charged. So, our central banker has to explain how setting lower rates, which he opposed, led to high rates, which he opposes. I doubt he has the brains to sort this out.
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