The role of the Fed going forward
 

I know I'm not a macroeconomic genius (if only I had the economic acumen of the two presidential candidates), but think this crisis has raised issues that need to be addressed going forward…

Has the role of the Fed changed forever with this crisis? Sure, they have stepped in as the lender of last resort, as they should (moral hazard aside). But does the large ownership of certain assets now demand that they use monetary policy to curb inflation outside of the CPI basket of goods?

In 2004 70% of Americans owned homes. That is 73MM homes; the highest number ever. According to the last census, IIRC, over 50% of Americans own stocks.

With that high a percentage of the population owning those assets, should the Fed put on the brakes when there is rapid increases in valuations? It seems to be just as important as CPI. But what percent of growth is too much? Fifteen percent a year? Twenty on the SP500. Twenty five on condos in Scottsdale?

I can fully see Greenspan's point: let the asset markets govern themselves. Plus regulation will always lag profit-motive-fueled innovation in markets. That being said, I feel they'll have to try and depress bubbles when their fallout can have far-reaching impacts; as much as it depresses me to say it.