To the Editor:
Re “An Early-Warning System, Run by the Fed,” (Economic View, July 26), in which Alan S. Blinder suggested making the Federal Reserve the nation’s regulator of systemic risk:
The column said that “when truly systemic problems arise, a lender of last resort is almost certain to be part of the solution — and that means the central bank.” But to me this description is an argument for a new, independent regulator outside the central bank. We need a system that clearly discredits the “too big to fail” mentality. Having a “lender of last resort” as the systemic risk regulator keeps this mentality alive.
See full Letter.
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