San Antonio Express-News
November 9, 2010

SAN ANTONIO — The Federal Reserve’s plan to rejuvenate the economy by buying $600 billion in Treasury bonds might be the “wrong medicine,” the Fed’s top official in Dallas warned Monday in San Antonio.

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Richard Fisher, president and CEO of the Federal Reserve Bank of Dallas, whose district includes Houston, said he could envision this second round of Fed purchases leading to a weaker dollar, “super ordinary inflation,” financial speculation and accelerating the transfer of wealth to the rich “from the “poor and the worker and the saver.”

“The remedy for what ails the economy is, in my view, in the hands of the fiscal and regulatory authorities, not the Fed,” Fisher said in a speech to members of the Association of Financial Professional.

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Fisher called on Congress to “incentivize” corporations to “take the kind of risk that expresses confidence in the future that will end up adding cap ex (capital expenditures) domestically and hiring more American workers.” Congress needs to figure out the right tax and regulatory regime to accomplish that, he said later in an interview.

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