20 To be sure, I would never advocate turning over monetary policy to a computer, but why shouldn’t the FOMC adopt such a rule as a guidepost to policy?
The financial stability framework needs to be able to identify and assess systemic risks corresponding to the degree of “interconnectedness” I just mentioned. In this context, macro-prudential oversight would focus on factors and risks that can affect the stability of the financial system as a whole and therefore would complement micro-prudential supervision, which looks at the stability of individual financial institutions.