Colin Barr

Following the money in banking, economics, and Washington

How Congress makes the Fed look sane

January 10, 2011: 4:59 PM ET

Calm down, there's no rush to make reservations for QE3.

Dallas Fed President Richard Fisher (right) expects the Federal Reserve to complete its $600 billion bond-purchase program, but "wouldn't be personally terribly keen" on an expansion of the Fed's second whack at so-called quantitative easing, given signs of economic recovery.

Has high hopes for Congress

Fisher also told the Wall Street Journal that while he believes the Fed's stimulus has "lifted the tide" for the economy, job growth remains weak because many employers remain tied to the dock or are creating jobs overseas, where costs are lower and red tape less sticky.

Fisher said, not for the first time, that he believes the Fed's work is largely done in reflating the economy, and that further policy-driven help will have to come from Congress.

"I hope people give the Fed some credit for … having reliquefied the markets," Fisher said. He said the question now is how to get banks to lend and businesses to spend, and "part of that is confidence in fiscal and regulatory authorities."

On that note, Monday also brought a timely comment from Rep. Ron Paul, the Texas Republican and Fed-basher who now runs the Monetary Policy Subcommittee of the House Financial Services Committee.

Paul, who in 200-9 introduced a bill that aims to break the Fed's monopoly on printing money, said taking over the leadership of the monetary policy panel "will facilitate my efforts to ensure the Fed provides the American people with more information about what they have been doing with and to our money."

He promises to redouble his efforts to audit the Fed, among other things. Of course, it is the other things that get you scratching your head a bit.

It is high time Congress insist on getting complete information on what the Fed has been doing, and for whom.  My hope is that exposing the truth will demonstrate the insanity of the status quo and more people will call for sensible changes, such as legalizing competing currencies.

That's some definition of sensible. Confidence in the fiscal authorities must be off the charts.

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About This Author
Colin Barr
Colin Barr
Senior Writer, Fortune

Colin Barr has covered finance for Fortune.com since November 2007. Previously he was a writer and editor for TheStreet.com, winning a 2006 Society of American Business Editors and Writers award for "The Five Dumbest Things on Wall Street," and for Dow Jones Newswires. He is a 1991 graduate of Penn State and lives in Port Washington, N.Y., with his wife Meena Bose and their two kids.

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