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'Get It Together, Congress,' Bernanke Says
This morning's news from Federal Reserve Chairman Ben Bernanke contained pretty much, well, no news at all: Congressional gridlock is the biggest obstacle to economic growth.
He opened his remarks to our nation's legislative branch this morning with the line: "The economic recovery has continued at a moderate pace in recent quarters despite the strong headwinds created by federal fiscal policy,” and continued by outlining all the ways fiscal policy squabbles could continue to curtail job creation and hamper recovery.
Continued Congressional bickering over the debt ceiling and philosophical fiscal differences would be too much for the already-tepid growth rates to bear: Bernanke reminded his audience that unemployment rates remain too high, while inflation has slowed to the lowest pace on record. He warned us against celebrating seeming falls in unemployment, which probably just mean fewer people working or looking for work.
"More generally, with the recovery still proceeding at only a moderate pace, the economy remains vulnerable to unanticipated shocks, including the possibility that global economic growth may be slower than currently anticipated," Bernanke said.
His speech once again made the case for recent Fed attempts to stimulate growth, including holding interest rates "at or near 0 percen" and expanding its holdings of Treasury bonds. In other words: Bernanke showed up to the hearing sober.
His less-than-optimistic remarks resonated with a stock market that fell flat later in the morning.