If we do not get a sustainable fiscal situation and deficits continue in large amounts for a long period, then it will become more difficult to sell our debt, and interest rates will rise, and they will be counterproductive.
Bernanke warns about the risks of unsustainable fiscal policies on debt and interest rates.
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Right now our concern is that the Chinese currency policy is blocking what might be a more normal recovery process in the global economy, and it is to an extent hurting our recovery.
We are working hard with our colleagues to put the Volcker rule into place, and that will restrict proprietary trading.
As I have said many times, I think that fiscal policy is focusing a bit too much on the short run, and not enough on the long run.
We have just finalized new capital requirements that banks have to hold against these assets for sale, these securities, which should provide protection.
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