Bernanke Faces Congress
In the Federal Reserve Bank’s Ben Bernanke’s regular report to Congress he presented a major report by the branch banks on the needs of small businesses to free up capital. Lack of a rebound in lending has an unsettling impact on job growth. The idea for freeing up credit that seems to have the most support is to cut interest on excess reserves in an effort to stop lenders from hoarding cash. A less popular tactic would be buying more mortgage backed securities or incurring more federal debt.
Bernanke was unusually candid in his assessment of the economy. He admitted that the labor market is the worst the U.S. has seen since the Great Depression. He bemoaned the slow housing market that is still riddled with foreclosures and vacancies that are keeping home values and home construction low. He also admitted an “unusually uncertain” economic future. The Federal Reserve Board as a whole sees more on the downside of the economy than to the good.
Right now the Fed is not contemplating much change. Corporate earnings have, by and large, been strong, and inflation continues to be low. Low consumer confidence and high unemployment will keep interest rates low for as much as the next two years.
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Wish anything Bernake has to say had any credibility. However, he might be right here, with no lending – the heart of legitimate capitalism – there is not much chance for growth, yet the corporate welfare capitalists (i.e banks, brokerages, giant retailers, Archer Daniels Midland, Halliburton etc. seem to have plenty of cash and wall street is happy. Inflation is low, there are no jobs in America and the barons of oligarchy are happy. Pretty sad commentary on our system these days.
Wish anything Bernake has to say had any credibility. However, he might be right here, with no lending – the heart of legitimate capitalism – there is not much chance for growth, yet the corporate welfare capitalists (i.e banks, brokerages, giant retailers, Archer Daniels Midland, Halliburton etc. seem to have plenty of cash and wall street is happy. Inflation is low, there are no jobs in America and the barons of oligarchy are happy. Pretty sad commentary on our system these days.
I feel bad for Bernake, he looks so beaten down. He doesn’t really run things over at the Fed right? I think he is a fall guy and just wants out, but wants people to be on his side. I am glad rates are down for the untouchable money many can’t get. The gov’t needs to let the economy reestablish and fix itself, because they suck at fixing something they can’t blow up. thanks,
Gabriel
http://www.money4iou.com