Mishkin: Finding asset bubbles not Fed role

JACKSON HOLE, Wyoming (Reuters) - When central banks aim to identify asset bubbles, they are deviating from their central role of ensuring low inflation and stable employment, Federal Reserve Governor Frederic Mishkin said on Saturday.

"There are a lot of costs in trying to anticipate bubbles," he said in response to questions after a speech at a symposium organized by the Kansas City Federal Reserve Bank. "When (central banks) do that, they start to lose sight of their basic mission ... and that is a high cost."

Participants at forum questioned Mishkin's argument in a paper that central banks should not accord swings in house prices a central role in monetary policy.

"A stitch in time saves nine," said Bank of Israel Governor Stanley Fisher. "I can't understand why you would wait for a bubble to explode before doing anything about it."