Persistently low interest rates are doing "a lot of damage," particularly to the financial industries that underpin the U.S. economy, former Dallas Federal Reserve President Richard Fisher said Wednesday.
The companies Fisher said he's most worried about are insurers.
"Insurance companies, particularly life companies, are like noble oxen. They pull the cart forward steadily forever and ever and ever. They're living in a 1 percent world in this country, but they're pulling a 3-to-6 percent liability cart. It doesn't square," he told CNBC's "Squawk Box."
Low interest rates are a major risk for insurers because the income they derive from investments — mostly in safe assets like Treasurys — may be insufficient to fund payouts to customers in low-rate environments.
Fisher said Fed policymakers did not anticipate the scope of easy money's impact on the financial sector.
"Bank's interest margins are being hammered. Money-market funds are trying to squeeze out a return. This is the kind of stuff, to be honest, sitting at the table, we did not foresee at the FOMC," he said, referring to the Federal Open Market Committee.
Germany is in even worse shape because the vast majority of Germans save through life insurance and their pension funds, he added.
Fisher reiterated his opinion that the Fed should raise rates by a quarter-percent at its June or July meeting, and then at least once again in the second half of the year. The FOMC raised rates a quarter-percent in December from nearly zero percent.