A woman who spent nine years as an advisor to Richard Fisher at the Federal Reserve Bank of Dallas says the Fed isn’t protecting the US dollar, has become too political and needs to change. In an exclusive RiskHedge interview, Danielle DiMartino Booth, author of Fed Up: An Insider’s Take on Why the Federal Reserve Is Bad for America, describes an institution she believes is almost out of control. “It’s not a political body, but it has become highly political and dangerous,” declares DiMartino Booth. “I call it the fourth branch of the US government, but with no checks and balances.”
A one-time Dallas Morning News financial columnist, DiMartino Booth wasn’t given a rousing welcome when she first joined the Fed in 2006. “Oh, I was none too welcome inside the Fed,” says DiMartino Booth. She was hired by Dallas Fed president Richard Fisher as an attempt to think outside the traditional economic box. Her book details a fascinating—and at times disturbing—tug of war between her Main Street-inspired economic ideals and the academic models favored by her Ivy League-educated career economist colleagues.
One of the key takeaways from her experience working at America’s central bank? “There definitely needs to be more accountability within the Fed. So, I sympathize with so many of the people who would rather end the Fed,” explains DiMartino Booth. “By the same token, we are the first largest economy in the world; China is the second. If we don’t have a strong, authoritative, objective monetary policy-making entity; if we don’t have a strong Fed—that needs to be reinvented mind you, it needs to be completely upended—then I fear for our financial security on the global stage with other countries that do have greater control of their currencies. And that is why my four children take Mandarin: it’s because I fear for the future of the dollar.”
Listen to the full interview with Danielle DiMartino Booth above.