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00:00DAVID: KEVIN WARSH IS STILL WITH US AND LAEL BRAINARD SPECIFICALLY ADDRESSED THE DOLLAR. >> I KNOW WHERE WELL AND SHE IS A SMART AND EFFECTIVE TREASURY OFFICIAL. WE USED TO HAVE AN AGREEMENT WHICH OF THE FEDERAL RESERVE DOES NOT TALK ABOUT THE DOLLAR AND THAT IS NOT TALK ABOUT INTEREST RATES. THAT WE WOULD KEEP OUR DIALOGUE RIGHT. WE TALKED A LOT ABOUT DIFFERENCES BETWEEN CHAIR YELLEN AND LAEL BRAINARD BUT I SEE A LOT OF SIMILARITIES. JANET YELLEN IN HER JACKSON HOLE SPEECH AND BRAINARD CAP'S TALKING ABOUT THE CURRENCY. THEY SAY THE DOLLAR IS TOO STRONG AND HE NEEDED TO BE WEAKER AND THAT'S COMING FROM CENTRAL BANK OFFICIALS. I THINK THERE IS A CONCERTED EFFORT BY POLICYMAKERS IN THE U.S. TO SAY THAT THE DOLLAR SHOULD BE WEAKENING. IF THEY HAD A WEAKER DOLLAR, WE WILL GET INFLATION BACK UP SO THERE IS MORE AGREEMENT AND DISAGREEMENT OVER CURRENCY QUESTIONS. DAVID: HOW DOES THIS FIT BACK INTO THE MANDATE OF THE FED? >> BY THEIR CALCULATION, INFLATION IS RUNNING AT 160% OVER THE LAST 12 MONTHS BUT WE HAVE NO IDEA. THE DATA IS NOT THAT GOOD. BY THEIR DECISION, THEY SAY INFLATION IS BELOW TARGET. I DON'T KNOW THE DIFFERENCE AND MEASURING BETWEEN 1.63 AND 2.0 ZERO. I THINK THEIR JUDGMENT IS THAT THE WEAKER DOLLAR WILL BE GREATER FOR THE U.S. ECONOMY. WHENEVER HE CENTRAL BANK AROUND THE WORLD IS TRYING TO DEVALUE AT THE SAME TIME, WE SPEND A LOT OF TIME AND EFFORT AND END UP BACK WHERE WE BEGAN. DAVID: WHAT'S THE DIFFERENCE BETWEEN TRYING TO KEEP IT UP AND TRYING TO KEEP IT DOWN? >> THE OLD DAYS WERE LIKE SIX YEARS AGO. WE HAD THE COMFORT ZONE, INFLATION WOULD BE BETWEEN 1%

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Former Fed Governor Warsh: Fed Wants a Weaker Dollar

Kevin Warsh, distinguished visiting fellow at Hoover Institution and former Federal Reserve Board Governor, discusses Federal Reserve comments on the U.S. dollar and the Fed's pinpoint accuracy on inflation targets. He speaks on "Bloomberg ‹GO›." (Source: Bloomberg)

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