The Fed, the Dollar and Wider Price Concerns

ft.com — The Fed can no longer carry the full burden for containing the housing slump. The White House and Congress must intervene with new policies to prevent a further upsurge in defaults and loan losses, or they may have to consider legislation mandating the government to assist in the recapitalization of the U.S. banking system with public money for the first time since the 1930s. If Congress does not want to be forced to rescue U.S. banks in 2009, it must stabilize the housing market in 2008. The dollar will only recover when housing does.

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