Kashkari on monetary policy and economic bubbles
- Fed must remain alert for signs of bubbles
- Should force banks to raise a lot more capital
- Extremely hard to spot asset bubbles forming
I agree with him on bubbles. You can't use rates to fight them. The best the Fed can do is issues warnings and try to shine a light on assets that are unsustainable. Beyond that, you need to let markets do their thing. If people get hurt later, at least you warned them.
