Raghuram Rajan Quotes

For the first time the committee [Federal Reserve] was using communication — mere words — as its primary monetary policy tool.

The Fed's ability to raise and lower short-term interest rates is its primary control over the economy.

Every central banker in the world pays attention to credit growth, but not in the U.S.

Interest rates are used to achieve overall economic stability.

Monetary policy is not a panacea.

There is always the potential for a central bank to engage in discretionary monetary policy and to break the one-to-one link between changes in foreign reserves and changes in the money supply.

True enough, the Fed needs radical reforms. In particular, it needs to replace its failed forecasting models and be rid of the academics who overwhelm the Fed system.

I believe that the history of Fed policymaking is that, you know, there are times when we need to raise rates.

The FOMC has considerable control over short-term interest rates. We have much less influence over long-term rates, which are set in the marketplace.

The Federal Reserve is incapable of accomplishing its stated objectives.

When they so-called 'target the interest rate', what they're doing is controlling the money supply via the interest rate. The interest rate is only an intermediary instrument.

Janet Yellen at the FED is equivalent to having a biology schoolteacher who has never seen blood perform brain surgery.

The Fed is the greatest hedge fund in history.

A snarky but accurate description of monetary policy over the past five years is that the Federal Reserve successfully replaced the technology bubble with a housing bubble

If we speak about fundamental things, regulation of the rate is actually the function of the main regulator, namely the function of the Central Bank. And it should think of how the economy and industry react, but also of its fundamental tasks in order to ensure the stability of the rate.

No major institution in the US has so poor a record of performance over so long a period as the Federal Reserve, yet so high a public reputation.

After a long period in which the desired direction for inflation was always downward, the industrialized world's central banks must today try to avoid major changes in the inflation rate in either direction.

There is a European Central Bank, of course, established and it has the structure similar to the Federal Reserve system, not precisely the same but similar.

By the time I became chairman and there was more of a feeling of urgency, there was a willingness to accept more forceful measures to try to deal with the inflation.

The Fed is the major U.S. firefighter. It's not the Treasury. It's not the Congress. We certainly saw that vividly in 2008.

All the Federal Reserve can do is make loans against collateral.

Monetary policy itself cannot sensibly be directed at reducing imbalances.

We made a decision that monetary policy will be made by an independent European Central Bank.

The Fed should make a clear commitment to stable money to reduce the swings in interest rates and inflation. Instead, it champions and flaunts unstable money. This encourages momentum trading and the growth of derivatives. Meanwhile, layers of financial regulation make Washington bigger and more powerful but don't fix the underlying problems.

There's no other job in public life that is like chairman of the Fed.