WASHINGTON (MarketWatch) -- Robert Rubin said the weak dollar, caused by unsound Bush administration fiscal policy, has now got to be a factor in the Federal Reserve's thinking about how low it can cut rates to spur economic growth in coming months.

Rubin said the Bush administration's "unsound fiscal regime" has hurt the dollar and this has created the "additional problem" for the Fed.

"It is there as an issue they have to face," Rubin, who served as Treasury Secretary in the Clinton administration and is now chairman of the board of directors at Citigroup, said in an interview with MarketWatch after speaking at a forum at the National Press Club.

Rubin stressed he had "no knowledge" about how much weight Fed officials put on the dollar in their closed-door discussions.

"The dollar certainly has been soft," he said.

During his tenure in Washington, Rubin was a firm believer in a strong-dollar policy. While he was Treasury Secretary he repeated the phrase "the U.S. supports a strong dollar" so many times that even former Fed chief Alan Greenspan wrote in his autobiography that he got sick of it.

Urges more regulation of derivatives

Asked for the views on the origins of the financial market turmoil, Rubin said it was a "confluence" of a series of events that no one foresaw.

A 3-4 year period where the markets under priced risk, some unsound financial engineering that created AAA rated complex securities and a large increase in housing prices "all came together," he said.

It has been much broader and lasted much longer than anyone imagined, he said.

Asked when the crisis might subside, Rubin replied: "I have no idea."

He said there shouldn't be "any let up" by economic policymakers working on solving the crisis.

Rubin repeated his earlier call for some margin requirements or capital requirements for complex derivative products.

Globalization of U.S. politics

During the session, Rubin said the global economy will be greatly affected by what direction the U.S. moves in politically over the next year or so. He said he didn't have any idea of the direction at the moment.

Looking at the big picture, Rubin said that "the whole architecture" of the post-War global economy might need to be changed to take into account the rising power of India and China.

The current system of trade imbalances and rising food and oil prices "just doesn't work," he said.

"We need an architecture that respects modern circumstances," he said.

It is frustrating that these ideas are not part of the debate over who should be the next president, he said.