UBS Chairman Weber: U.S. in Deep Fiscal Crisis

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Oct. 10 (Bloomberg) -- Axel Weber, chairman at UBS, discusses the global focus on the U.S. debt limit as he sees the nation in deep fiscal and political crisis, the two other major areas of global economic concern and how Janet Yellen will bring continuity to Federal Reserve policy. He speaks on Bloomberg Television’s “Bloomberg Surveillance.”

The former president of the germany central banker it is a pleasure to have you here at the imf.

Good morning, sara.

When it comes to these imf world bank meetings, in the past years, the europeans have gotten the blame.

You clean up your debt crisis.

This time, if the americans.

There is a real global concern, isn't there you?

In europe, there is still a lot of work to do.

A year ago, the focus was all on europe.

Everyone was concerned.

Now, we have three areas of concern, and i'm not sure we are in a better place by looking at three problems jointly.

Europe is still fighting the problem.

It has come out of these recession, but it is not still back in growth.

The u.s. is having a deep fiscal and political crisis.

China has been weakening somewhat and it's coming back.

So three concerns now.

Janet yellen is the story here.

In the world of central banking, janet yellen now becomes the most powerful central banker in the world, or at least among them with mario draghi.

What will be the impact on international markets and international economies of the continuity of said chief ben bernanke's policy?

My reading of it is the following -- i think we have in central banking now a very strong sense that central banks step in to prevent worse things happening.

They are trying to go back to more normal policies as to what is normalizing.

I think the big feature of this year has been a normalization of the world economy, the u.s. has taken again a lead position in the recovery.

Emerging markets have am now quite a bit.

They are lagging at the mormon.

Europe -- at the moment.

Europe is trying to come out of a deep crisis.

The central banks played a key role inaccurate i see it as a sign of continuity.

Janet yellen was a trademarked name in economics.

Very experienced during the crisis good i see it as a sign of continuity.

As chairman of ubs and formally with the budnndesbank, does janet yellen have the ability when the time is appropriate to act more bundesn bank-like?

I think that is a long stretch.

I think the view is more that's -- what will be more important in central bank he will be the committee views.

I think the fed is moving toward that.

The ecb is moving to that.

What matters is much less the person, the one person at the helm of the bank but more worthy committee sees the economy.

The fed has moved toward a communication that put the committee at the core.

Look at their projections are interest rate will be in the years going forward.

The consensus view were most of the people seeing interest rates -- is a good guide for markets.

We have learned over the last number of days how biased chairman yellen has led the communication strategy of our fed.

So leading economists in the world -- are our central banker saying too much?

No, they need to communicate their view of the world.

It should be taken with salt.

It should be a conditional view that is based on incoming data and should be a view that is communicated within the frame work of a committee decision rather than a single view.

The other major responsibility of the federal reserve and other fence -- central banks is federal regulation.

The fed has to hone this area to regulate the banks.

Now you are at ubs from the central bank world to a bank that faces its own regulatory headaches.

How effective you think she is and the fed needs to be in that realm?

I think the central bank's are getting broader as we talk.

There is now a sense of urgency around macro credential tools, which are becoming a new part of the central bank's mandate.

Some are charged with micro, which they have not been before the crisis.

The central banks become more central to the financial market.

I am not sure that that is not a distraction.

We will have to leave it here.

This text has been automatically generated. It may not be 100% accurate.

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