The recurring mantra that central banks should avoid getting involved with asset bubbles should be reexamined, according to San Francisco Fed President Janet Yellen, who added there needs to be policies to deal with the issues.
"I think it's time to take another look," said the central banker at an event in New York City on Thursday. "Not dealing with certain kinds of bubbles before they get big can have grave consequences," she added.
The shift in rhetoric is significant given repeated commentary from central bankers across the globe saying that asset price targeting is both ineffective and wasteful.
Yellen also added her voice to the number of central bankers and government officials saying there were tentative signs of improvement in the U.S. economy.
Yellen is a voting member of the Federal Open Market Committee.