Fisher Says More Stimulus May Overburden Central Banks

Federal Reserve Bank of Dallas President Richard Fisher
Federal Reserve Bank of Dallas President Richard Fisher said, “We’re at the risk of overburdening the central banks.” Photographer: Peter Foley/Bloomberg

Federal Reserve Bank of Dallas President Richard Fisher said adequate economic stimulus is in place and that global central banks may not have the capacity to undertake additional measures.

“We’re at the risk of overburdening the central banks,” Fisher said in an interview today on “Bloomberg Surveillance” with Tom Keene and Sara Eisen. “We keep applying what I call monetary Ritalin to the system. We all know there’s a risk of over-prescribing.”

Fisher said the largest banks have $1.5 trillion in excess reserves that they would like to put to work and that the private sector now must take the next steps to boost growth. Lawmakers also must act to eliminate uncertainty about government spending and tax rates, Fisher said.

“We have done our job,” Fisher said of the Fed. “We have done enough. Just doing more doesn’t solve the problem. The problem is engaging the transmission. We provided the gas, the gas tank is full.”

The Dallas Fed chief isn’t a voting member of the policy-making Federal Open Market Committee this year. He dissented last year twice against moves to push down long-term rates and to keep the benchmark U.S. interest rate near zero until at least mid-2013. He voted five times in 2008 in favor of tighter policy.

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