John Allison: Get Rid of the Fed

During an interview on the FOX Business Network’s After the Bell, John Allison, former CEO of BB&T, said he would like to “get rid of the Fed,” and blamed the central banking system for playing a “major role” in the housing crisis of the mid to late 2000s.

“They created negative real interest rates for years that incented the housing bubble, along with the government agencies Freddie Mac and Fannie Mae. So they started a fire; you can debate whether they put it out or not,” Allison said.

Instead, Allison said he would like to “discipline” the Federal Reserve, since getting rid of it would not “work politically.”

“I think the simple thing to do is go to some kind of rule like the Taylor rule, where they can’t just arbitrarily create money that creates bubbles and then try to fix it by holding rates too low. Yes, free markets are going to have ups and downs, but nothing like what I think monetary policy creates through the Fed,” he said.