Last quote by Ben Bernanke
Ben Bernanke quotes
Economic growth in the first quarter was supported by continuing expansion and demand by US households and businesses, which more than offset the drag from declines in government spending – especially defence spending. Despite this improvement the job market remains weak overall, the unemployment rate is still well above its longer-run normal level, rates of long-term unemployment are historically high, and the labour force participation rate had continued to move down.
Because stronger growth in each economy confers beneficial spillovers to trading partners, these policies are not 'beggar-thy-neighbor' but rather they are positive-sum, enrich-thy-neighbor' actions.
When something is more costly, you do a little bit less of it.
The economy's longer term rate of growth and unemployment are determined largely by non-monetary factors, such as the rate of growth of labour force and the speed of technological change, and it should be noted that estimates of these rates are inherently uncertain and subject to revision over time.
It will be several years before the unemployment rate has returned to a more normal level.
Considerable time likely will be required before the unemployment rate has returned to a more normal level. Persistently high unemployment by damping household income and confidence could threaten the strength and sustainability of the recovery.
Even as the Federal Reserve continues prudent planning for the ultimate withdrawal of extraordinary monetary policy accommodation, we also recognise that the economic outlook remains unusually uncertain. Although fiscal policy and inventory restocking will likely be providing less impetus to the recovery than they have in recent quarters, rising demand from households and businesses should help sustain growth.
Notwithstanding the positive signs, the job market remains quite weak.
We played a central role in efforts to quell the financial turmoil, for example, through our joint efforts with other agencies and foreign authorities to avert a collapse of the global banking system last fall, by insuring financial institutions adequate access to short-term funding when private funding sources dried up.
We also believe that it is important to assure the public and the markets that the extraordinary policy measures we have taken in response to the financial crisis and the recession can be withdrawn in a smooth and timely manner as needed, thereby avoiding the risk that policy stimulus could lead to a future rise in inflation.
In the longer term, I think it's very important that Congress makes sure that the deficits are not excessively large. The main thing is that you'd be consistent: If you want to increase spending, then you have to be willing to accept tax increases.
The effectiveness of the policy actions taken by the Federal Reserve, the Treasury, and other government entities in restoring a reasonable degree of financial stability will be critical determinants of the timing and strength of the recovery.
The current financial crisis and economic slowdown have been an occasion for unprecedented international policy coordination within Europe, but in addition, the coordinated rate cut was intended to send a strong signal to the public, and the markets of our resolve to act together to deal with global economic challenges.
Our strategy will continue to evolve and be refined as we adapt to new developments and the inevitable setbacks. But we will not stand down until we have achieved our goals of repairing and reforming our financial system and thereby restoring prosperity to our economy.
For its part, the Federal Open Market Committee will monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability.
I agree with the Treasury Secretary. The Federal Reserve will give full support to the fundamental reform of the financial industry. But whatever reforms the Congress makes should apply to the whole industry, whether they participate in this programme or not.
As events in recent weeks have demonstrated, many financial markets and institutions remain under considerable stress. Consequently, helping the financial markets to return to more normal functioning will continue to be a top priority of the Federal Reserve.
Recently, incoming information has suggested that the baseline outlook for real activity in 2008 has worsened and that the downside risks to growth has become more pronounced.