By Caitlin Kenney

Federal Reserve Chairman Ben Bernanke is expressing support for the idea of having a council of regulators monitor systemic risk. In testimony before the House Financial Services Committee today, Bernanke said the Fed does a good job of monitoring the country's largest financial institutions but could use help watching the broader economy. However, he was quick to defend his agency when Representative Paul Kanjorski, D-Penn., said he was glad to see Bernanke was "not supportive of greater powers for the Federal Reserve." Bernanke responded:

There is not really a change. I think there has been some misunderstanding. We have never supported and the administration has never supported a situation in which the Fed would be some kind of untrammeled super regulator over the whole system. That is not what has ever been contemplated. The original administration proposal proposes a council, and we support the council. We think it has a very valuable role to play. We think underneath the council, each of the agencies, including the Fed but also including the SEC and others, should be looking at the systemic implications of their actions and working together through the council to look at the whole system. We have never objected to the council.

The Obama administration has been criticized for parts of its of its financial regulatory reform which some say would give the Fed too much power.

categories: Politics

5:37 - October 1, 2009

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