Former Treasury Official Blames The Fed for Current Financial CrisisSubmitted by bobbyw24 on Thu, 05/14/2009 - 07:59
The Fed helped to trigger the current financial crisis by keeping rates too low for too long, Taylor said.
“Low interest rates led to the acceleration of the housing boom,” he said. “The boom then resulted in the bust, with delinquencies, foreclosures and toxic assets on the balance sheet of financial institutions in the United States and other countries.”
John Taylor, the former Treasury official who devised the “Taylor Rule,” a formula for rate- setting based on the outlook for inflation and growth.
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