Former FOMC Alternate Member: The Fed Is A "Super Tanker" And It Can't Just Turn Policy Around

Larry Meyer, former Fed governor, and Ernest Patrikis, former FOMC alternate member, spoke to CNBC this morning about the future of the Fed.

Meyer doesn’t expect any response to criticism of the Fed’s quantitative easing 2 policy from Congress or the public. He also doesn’t see any changes on current policies.

Patrikis expects the Fed to come under further public criticism. There is pressure now to change the Fed’s mandate, he says, but there will be no changes from the Fed in terms of policy, for now.

“This is a super tanker,” he says, explaining it just can’t go into the corner and turn around.

Patrikis says that, right now, it’s hard to tell the impact of the credit crisis on consumer psyches. The reduction in spending by U.S. consumers, according to Patrikis, is a result of this.

Later on, the group discuss future scrutiny of the Fed by people like Rep. Ron Paul, soon to be chair of the Subcommittee on Monetary Policy.

Patrikis says Fed Chairman Bernanke may soon have to do a press conference, post FOMC meeting, like is done in Europe by the ECB.

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