| This thesis looks at the evolution of the Federal Reserve's mandate and regulatory responsibilities as a result of the Global Financial Crisis. The onset of the crisis exposed the financial system to risks that had yet to be identified by the traditional microprudential regulatory framework, necessitating a rapid and unconventional response in order to prevent widespread financial collapse. Now, in 2015, as most of the scourges of the crisis are in the recent past, practitioners are beginning to not only pick up the pieces but attempting to reform the system to increase resilience in the future. One of the proposals taking center stage in this effort is an increased focus on financial stability in economic policymaking, in order to prevent the meteoric rise in unsustainable risk that contributed to the crisis arising just eight years ago. This need for reform is juxtaposed with the theoretical thrust to maintain central bank independence. The interaction between central bank independence and a financial stability mandate will be discussed, with a focus on macroprudential regulation.;The views expressed here are those of the author and do not necessarily reflect those of The Federal Reserve Bank of Richmond, the Board of Governors of the Federal Reserve System, or the Federal Reserve System. |
