Regulation should aim to burst bubbles

Frederic Mishkin, a governor at the Federal Reserve, has acknowledged that the Fed should consider responding to asset price bubbles - a move that would contravene a tenet of the Greenspan-era institution.

Mishkin said on Thursday that the Fed should use its influence as the US's primary financial regulator to temper unjustified surges in asset prices, which he said "create risks to the financial system and could have large negative effects on the macroeconomy."

"Monetary policy is already

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