Federal Reserve Bank of Philadelphia CEO Charles Plosser is not a fan of the Fed buying mortgage-backed securities. 

In a speech to the Global Society of Fellows of the Global Interdependence Center in Paris, Plosser said central banks should be wary of continuing down a path in which they step too far into the zone of taking on fiscal policy. He cited the Fed's effort to assist the fledgling housing market through the acquisition of mortgage-backed securities as one example.

"These credit allocations have not only breached the traditional boundaries between fiscal and monetary policy, they have generated pointed public criticisms of the Fed," Plosser said.

Plosser said having a concentration of housing securities on the Fed's balance sheet is a type of credit allocation and pushes the Fed well beyond the boundary of monetary policy into fiscal policy.

Plosser suggested central banks establish a clear divide between monetary policies enacted by central banks and fiscal policies enacted by Congress. He suggested it makes sense for central banks to focus on price stability, while allowing fiscal policymakers to handle other fiscal initiatives. 

The Fed's current policy is to focus on both price stability and fostering employment.

"The ability of a central bank to maintain price stability can also be undermined when the central bank itself ventures into the realm of fiscal policy. History teaches us that unless governments are constrained institutionally or constitutionally, they often resort to the printing press to try to escape what appear to be intractable budget problems," he said.

"And the budget problems faced by many governments today are, indeed, challenging. But history also teaches us that resorting to the printing press in lieu of making tough fiscal choices is a recipe for creating substantial inflation and, in some cases, hyperinflation," he added.