Federal Reserve

Kohn: Oversight can only do so much

Donald Kohn, former vice chairman of the U.S. Federal Reserve
Mik Fuentes | Bloomberg | Getty Images

Easy monetary policy can create risks too big for regulators to handle, former Federal Reserve vice-chairman Donald Kohn said on Monday, according to a Dow Jones report.

Kohn—a potential candidate for the next Fed chair after Larry Summers' shock withdrawal—made the remarks at a Brookings Institution event.

"Very easy monetary policy often builds imbalances that may become so large that they can't be countered by regulation," Dow Jones quoted him as saying.

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Kohn also questioned whether the Financial Stability Oversight Council—a key pillar of the Dodd-Frank financial reforms—has adequate resources to carry out its mission.

"The jury's still out," Kohn said, according to the report.