Fed's Fisher: Fed Actions Pulled U.S. From Abyss

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Dallas Federal Reserve President Richard Fisher said Friday that the actions taken by the Fed during the 2008 financial crisis have pulled the U.S. back from the abyss of financial collapse.

"In our wildest dreams, none of us imagined what we have seen transpire in the last two years of our economy," he said.

Speaking at Duke University in an interview with Cokie Roberts, Fisher said that the members of the Fed are doing their "level best" to fix a broken system.

Fisher said that he expects to see positive economic growth in the future, though he admitted that he is a bit more pessimistic than others in the Fed about such growth.

The Dallas Fed chief said that it would be sometime before the U.S. sees positive expanding employment numbers, due to "disinflating" prices forcing employers to cut jobs.

Earlier on Friday, it was reported that the U.S. unemployment rate rose to 9.8 percent, its highest level since 1983.

Fisher also said that everyone in the Fed is concerned about inflation, due to the massive expansion of the central bank's balance sheet in the wake of the financial crisis.

He did add, however, that he and his colleagues have been working to develop ways to manage inflation, should it occur, and said that he was confident that the Fed will be able to effectively unwind monetary policy when it is necessary.

Fisher's appearance at Duke comes on the heels of remarks he made Tuesday at a speech before the Texas Christian University Business Network, in which he said that a monetary wind-down process "needs to begin as soon as there are convincing signs that economic growth is gaining traction and that the lending capacity of the banking system is capable of expansion."

"I am not alone on this front," he said on Tuesday. "I have faith my colleagues on the Federal Open Market Committee will stand and deliver in a timely way. And I expect that when it comes time to tighten monetary policy, my colleagues and I will move with an alacrity that, if needed, will be equal in speed and intensity to that with which we pursued monetary accommodation."

Dallas Federal Reserve President Richard Fisher said Friday that the actions taken by the Fed during the 2008 financial crisis have pulled the U.S. back from the abyss of financial collapse. "In our wildest dreams, none of us imagined what we have seen transpire in the last two years of our economy," he said. Speaking at Duke University in an interview with Cokie Roberts, Fisher said that the members of the Fed are doing their "level best" to fix a broken system. (Market News Provided by RTTNews)