Sen. Elizabeth Warren blamed some of the recent banking crisis on Federal Reserve Chair Jerome Powell, saying he “took a flamethrower” to regulations in her most forceful criticism yet after the collapse of Silicon Valley Bank.
The Massachusetts Democrat’s claims came Sunday on ABC’s “This Week”, as she took aim at Trump-era bank deregulations that eased rules that included risk management standards and stress testing requirements.
Warren: Fed chair Powell ‘had two jobs’ and ‘failed at both’
Warren has heavily criticized Powell in the past for the Fed’s aggressive fight against inflation by raising interest rates, warning that high interest rates could lead to higher unemployment rates.
“Raising interest rates doesn’t do anything to solve those problems. All it does, at least by the way the chair wants to do this, is put millions of people out of work.” Warren said on NBC’s “Meet the Press.”
With the recent collapse of SVB, Warren expressed little confidence in Powell’s capability to serve as chair of the Fed.
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“Look, my views on Jay Powell are well-known at this point. He has had two jobs. One is to deal with monetary policy. One has to deal with regulation. He has failed at both.”
Warren calls for independent investigation into Federal Reserve
On Monday, the Fed announced that it will be conducting an internal review of its supervision and regulation of Silicon Valley Bank. Warren slammed the investigation, calling for an independent third-party investigation on ABC’s “This Week.”
“I’m calling for an independent investigation of the Fed and the whole regulatory system here. The Fed doesn’t just get to do its own investigation,” Warren said.
Related:Biden, DNC will return political donations from Silicon Valley Bank executives
What happened to SVB?
Silicon Valley Bank, a bank closely tied with technology start-ups and venture capital, collapsed last Friday due to a bank run, caused in part due to the Federal Reserve’s hike of interest rates and the decline of technology stocks.
Story Credit: usatoday.com