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Grassley: Financial Reforms Give Fed Too Much Power

President Barack Obama's plan to overhaul financial regulations gives the Federal Reserve too much power and will distract it from its core mission of setting monetary policy, Sen. Charles Grassley told CNBC.

“I’d rather have the Fed concentrate on monetary policy,” said Grassley, the top Republican on the Senate Finance Committee.

Grassley was mostly positive about the plan, however, which President Obama is set to unveil on Wednesday and which seeks to eliminate gaps in the financial system that encouraged last year's financial crisis.

“It seems to me if you look back at each element of the last five years that have led to the credit crunch we’re in now and the resultant recession, that it takes care of a lot of it," Grassley said of the proposal, which was outlined in an op-ed on Monday by Treasury Secretary Timothy Geithner and White House economic adviser Larry Summers.

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