Not quite six months into her term, Federal Reserve Chair Janet Yellen already faces a stern test: unrest from within.
Dallas Fed President Richard Fisher's op-ed column in Monday's Wall Street Journal represents an unusual—though not entirely unprecedented—public calling-out of the central bank's policies and, by extension, the chair. Long considered a maverick among the Fed's 12 regional presidents, Fisher expressed concern that ultra-loose monetary policy is creating "financial excess" leading to "an artificial sense of confidence" in financial markets.
"Given the rapidly improving employment picture, developments on the inflationary front and my own background as a banker and investment and hedge fund manager, I am increasingly at odds with some of my respected colleagues at the policy table of the Federal Reserve as well as with the thinking of many notable economists," Fisher said.
His hawkish, outlier stance aside, however, the sentiments Fisher expressed are gaining traction among Fed-watchers and presenting a challenge for Yellen.
"They get more difficult for her," Carnegie Mellon Fed historian Allan Meltzer said in an interview when asked the type of conditions Yellen faces going forward.