11 A consensus on monetary policy goals Last January, the FOMC took a major step to clarify its interpretation of its dual mandate, issuing the “Statement of Longer-Run Goals and Monetary Policy Strategy” that I mentioned earlier.
Indeed, the literature generally suggests that ‘optimal’ capital is not only higher than regulatory minimums, but can also span quite a wide range. The literature is therefore helpful in pointing to the direction that regulatory capital should travel, but not the destination. We are naturally cautious in how we think about risk to the banking sector.