Cracks In The Financial Establishment?

World Bank Chief to Take Shots at the Fed

...In a speech he’ll deliver at the Paul H. Nitze School of Advanced International Studies of the Johns Hopkins University Monday, Mr. Zoellick says central banks around the world fell down as regulators. He questions whether Congress should give the Fed any more power as it looks for ways to revamp financial sector oversight.

“Central banks failed to address risks building in the new economy,” Zoellick says...

Zoellick is a veteran U.S. economic-policy official who served at the U.S. Treasury from 1985 and 1993 where he was, among other posts, deputy assistant secretary for financial institutions policy under then Secretary James A. Baker III...

...“It will be difficult to vest the independent and powerful technocrats at the Federal Reserve with more authority. My reading of recent crisis management is that the Treasury Department needed greater authority to pull together a bevy of different regulators. Moreover, the Treasury is an Executive department, and therefore Congress and the public can more directly oversee how it uses any added authority...”

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