Bernanke says economy is close to faltering
In a testimony before Congress today, Federal Reserve Chairman gave his latest opinion on the American economy, and to the head of the Fed, things still aren’t looking too good.
Speaking to the Joint Economic Committee of Congress on Capitol Hill this morning, Chairman Bernanke said that the US economy is “close to faltering,” and though the Fed is prepared to lend a hand to help the country avoid catastrophe, he said that the Executive and Legislative branches must make great strides in their own initiatives, lest lawmakers want to allow the country to surely slump into a double-dip recession. To both Democrats and Republicans this morning, Bernanke said that turning the economy around is a "shared responsibility of all economic policy makers, in close cooperation with the private sector." He added that while the Fed has their own plans to help if need be, the government could be doing good on their own by investing in the labor markets, housing, trade, taxation and regulation. Speaking on behalf of the Federal Reserve, Bernanke told Congress, "The Committee will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in the context of price stability.”Weeks ago the Fed revealed Operation Twist, a $400 billion program that aimed to exchange short-term bonds for longer-lasting Treasuries and encourage risky investments to revitalize the economy. During that statement, the Federal Reserve acknowledged that conditions impacting the American economy were only worsening. Bernanke himself has repeatedly voiced a pessimistic point-of-view on the matter. Earlier in the year he said that setbacks should be expected while the American economy attempted to heal, something he said would “take a while.”Only last week he spoke before an audience in Cleveland, Ohio and gave an updated outlook on the economy, saying that the jobs problem plaguing the country was of utmost concern."This unemployment situation we have, the jobs situation, is really a national crisis," Bernanke said from the InterContinental Hotel in Cleveland last week. "We've had now close to 10 percent unemployment for a number of years. Of the people who are unemployed, about 45 percent have been unemployed for six months or more.” Today’s statements echoed other points Bernanke made from Ohio. Last week he warned that "Monetary policy can do a lot but it's not a panacea. It can't solve all of the problems.” Today he said that the Fed would continue to take steps to do as much as it could, but urged lawmakers to take matters seriously. We need to make sure that the recovery continues and doesn’t drop back and that the unemployment rate continues to fall downward,” the chairman said today from Washington. The government will release labor statistics for the month of September come this Friday. Figures have stayed stagnant at or above 9 percent for the last several months as around 14 million American remain unemployed.