Dallas Federal Reserve President Richard Fisher spoke with FOX Business Network’s (FBN) Maria Bartiromo about the Alibaba Group Holding Ltd (NYSE:BABA) IPO today, saying Executive Chairman Jack Ma “is selling into a market that is very rich; we have helped make it so at the Federal Reserve” and that it is “good timing, I would say, smart guy.” Fisher went on to comment about his dissenting at the Federal Reserve meeting this week saying, “I’m not worried about inflation right now” and that “I do think there are some signs of excess in the financial markets.” When asked about rate hikes Fisher said, “I personally expect it to occur in the Spring and not in the Summer.”

Fisher: Ma Smart For Selling Into Market We Helped Make Rich

Richard Fisher on Alibaba:

“He is of course selling into a market that is very rich; we have helped make it so at the Federal Reserve.  I think my personal view, having been in the business is, of course, you never fight the Fed, but we have been extremely helpful. Remember after that March ’09 bottom, we’ve come up over 2.5 times.  So good timing, I would say; smart guy.  And the question is, of course, how long is this going to be sustained and the markets will make that decision.”

Richard Fisher on when he sees rates rising:

“I personally expect it to occur in the spring and not in the summer as it seems the markets are discounting.  But we will see.  I think that would be wiser; it depends, as Chairman Yellen said, on the developments in the economy.”

Richard Fisher on why he dissented at the Federal Reserve meeting this week:

“Look, contrary to what everybody says, I am not worried about inflation now.  In fact, my statement said I was aware of the price stability. What I am concerned about is the fact that employment has improved significantly.  We got very good numbers yesterday.  This is like duck hunting, you shot ahead of the mallard rather than try to get it from behind, otherwise you can’t hit it.  And we have to lead on this front.  So there is that issue, which is we have improving employment…And the second is I do think that there are some signs of excess in the financial markets… from a market standpoint, you are being deceived. Things getting a little bit rich, particularly — even though the junk market spread has come off a little bit, we’re seeing some GAAP  downs and some junk issues.  It’s driven by ETFs.  And when you get individual bids on individual bonds, I have seen some dramatic behavior recently.  Now these are lousy companies.  That’s why they’re triple Cs.  But they’re begin to see a little fissures.  And that concerns me and I don’t want to drive this any further.  And I think we have to be aware of this and I personally would want to see the date of our first move.”

Richard Fisher on raising rates:

“I’m in a slow and gradual school, I think it would be a mistake to wait too long and then raise rates rapidly.  So once we start raising rates, when the committee decides to do that, whether it’s the spring or the summer or whatever it may be, I think it ought to be in quarterly increments, slow and deliberate and we just have to adjust and feel how the economy comes.  If we wait too long and we raise rates steeply, there is no time in history that I am aware of when the Fed has done that it hasn’t driven the economy into a recession.  And what I worry about is that is the last thing we need…We’re leading the world along with the U.K. in terms of our economy.  Everyone else is not doing so well.  I wouldn’t want to get to the point where we act severely and we drive us back into a recession.  And that is the history going all the way back, whenever we’ve raised rates too much after we’ve overshot the mark on employment.”

Richard Fisher on how to unwind the Federal Reserve’s balance sheet:

“Very slowly…And Chair Yellen mentioned this.  The plan by the committee now is to just not reinvest after a certain period once we start raising rates.  Now that is the point of departure for me, by the way.  I thought it was a natural for us once we stopped our purchases, which we said in the statement we will stop in October.  That delights me personally, as you know. But it would have been a good time — I argued at the table — to begin reducing our reinvestment, it was a natural flow-through, before we announced we were going to raise rates whenever we decide to do that.  But I lost that argument at the table and you have to respect the others that are there.  I was alone, but I lost the argument.”

Richard Fisher on the housing market:

Well, one of the things that happened is prices came up too fast.  If you talk to housing builders, they will tell you this.  Prices moved too far too fast.  So there’s a little bit of sticker shock. Secondly, there is a real problem with qualification, particularly with the younger generation, all these college loans that they have and qualifying to get permission to borrow money to invest in homes.  There’s a shortage of lots.”

Richard Fisher on whether there is shortage of skilled labor:

“One of the things they do not talk about, particularly the publicly traded companies, is a shortage of skilled labor. Now here, where we have a hot real estate market, you literally see armed guards posted around construction projects to keep people from poaching the labor force.  It is astonishing.  But there is a shortage of skilled labor.  Mexicans build homes in America.  I don’t care if it is Bangor, Maine, or Portland, Oregon, or Dallas, Texas.  That is immigration policy.  I defy you to find a homebuilder that says mortgage rates are really the issue.”

Richard Fisher on the unemployment numbers:

“Yes, the numbers came back very hard and by the way, it is July numbers were readjusted upward.  They’re pretty attractive.  So that’s — but that is something that people look at.  If you look at the employment numbers and the claims numbers that came out yesterday, that surprised everybody by being so low, unemployment claims. So there is movement forward.  This is good.  The Fed should take some credit for it.  It would be so much better if our fiscal authorities just get their act together.”

Richard Fisher on Scotland’s Independence vote:

“I don’t think it’s over, by the way.  They are get concessions for the government, and now the Welsh are going to ask for the same thing and the Irish will ask for the same thing.  So Catalonians will ask for the same things. So this is an interesting little thing, but I’m glad, after 308 years of history, that they held it together.  But they’re going to get more powers and all power to them for getting it.”

Richard Fisher on President of the European Central Bank Mario Draghi:

I mean, their process is they’re just beginning it, the first takedown of those new instruments wasn’t that robust.  But remember, they’re in a different stage of development than we are.  Our central bank has been trying new techniques for quite some time.  The real problem there, we have one dysfunctional government to deal with; they’ve got numerous governments that have different fiscal policies.  So my sympathy is I think Mario is one of the great central bankers, he certainly knows the business from his Goldman Sachs background to his theoretical background, it’s an unusual combination.  I hate to comment negatively at all, so I’m just going to wish him well in this process.  The backdrop there is from a fiscal standpoint is not very positive.  You have disparate governments and of course you have France ,which is uber weak right now with a president that is even lower rated in the polls than ours.”