Bernanke: Economic outlook weaker

[struggle4progress]

Source: CNN

Fed chairman says financial crisis will dampen economy well into 2009 and hints at future rate cuts; says recent actions by Fed, Treasury should help economy recover.
By Chris Isidore, CNNMoney.com senior writer
Last Updated: October 7, 2008: 2:43 PM ET

NEW YORK (CNNMoney.com) -- Federal Reserve Chairman Ben Bernanke predicted that the global financial markets crisis is likely to restrain the economy well into next year and signaled that the Fed may be getting ready to cut interest rates ... In a speech before the National Association of Business Economics in Washington on Tuesday, Bernanke said the threat of inflation has receded recently, while the economy has continued to weaken. This could be interpreted as a sign that the central bank might be preparing to lower its key fed funds rate soon. "Overall, the combination of the incoming data and recent financial developments suggests that the outlook for economic growth has worsened and that the downside risks to growth have increased," he said ...

Read more: http://money.cnn.com/2008/10/07/news/economy/bernanke_speech/?postversion=2008100714

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Saying Outlook Has Worsened, Bernanke Hints at Cut
By DAVID STOUT and EDMUND L. ANDREWS
Published: October 7, 2008

... Mr. Bernanke hinted strongly that the Fed’s Board of Governors would probably lower interest rates at its next meeting, on Oct. 28 and Oct. 29. And he said that, however reluctantly, the Fed would continue to aggressively use all the tools it had to help ease the financial turmoil. “These are momentous steps,” he said, “but they are being taken to address a problem of historic dimensions.” Only a few weeks ago, the Fed’s official posture was that inflation was a serious concern ... Mr. Bernanke spoke hours after the Fed announced a new program to buy up companies’ unsecured debt ...

http://www.nytimes.com/2008/10/08/business/economy/08bernanke.html?hp


Fed Considers Plan to Buy Companies' Unsecured Debt
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=102&topic_id=353108

[ixion]

1. gee, Ben, ya think?

:eyes:

[2Design]

2. he just needs to go to www.thehousingbubbleblog.com and patrick.net

the know this has been predicted for over 4 years - they like our current admin like acting surprised that their actions caused this mess

[endarkenment]

3. fucknuckle

I am pissed. I will never be able to retire. Every time I get close, the fucknuckles steal all my money. Where is my fucking bailout?

[dipsydoodle]

4. Well there's a surprise

knock me down with a feather.

[whistle]

5. BIG BIG MISTAKE to lower interest rates will have no effect on economic stimulation

...will only make cheap money available to speculators and stock market gamblers so they can loot every last asset

[depakid]

6. Wow

Every now and again someone posts a statement so clueless that it shocks even me.

[whistle]

7. Explain yourself please

[depakid]

9. How does respond to something like that?

With the basics of monetary policly?

One thing interest rate cuts do is stimulate the economy, by lowering- or in this case helping to unfreeze, borrowing that businesses and banks routinely engage in for everything from expanding their operations, filling orders, making payroll, etc. That's why they're raised when the economy is "too hot" -because it helps to keep inflation in check.

They're not- particularly with these market conditions, going to provide "cheap money" to speculators or "stock market gamblers" so they can loot every last asset!

Whether they will help the current situation is unclear. It doesn't matter how low official interest rates go if no one is lending money. That is why it is called a credit crisis. There is not any credit, unless you are prepared to pay an exorbitant price.

But it certainly isn't going to hurt- particularly if other nation's central banks follow the Australian Reserve Bank's bold example yesterday of a full point cut (interest rates are traditionally much higher in Australia, which is one reason why they have much room to manuever).

[Critters2]

8. This just in: sun to rise in east tomorrow morning.

God! My beagle could do a better job!

[jjanpundt]

10. Does a new president get to appoint a new Fed Reserve

chairman? I think he still has time left on his 4 year appointment, but couldn't Bernanke be fired for all the misleading statements (lies) he made about the economy? Since economists were warning about a possible crisis when Greenspan was still Fed head, there's no way Bernanke could not have known it was all going to hit the fan. He should have defied shrub and prepared people for this collapse. Or he could have been pro-active and tried to avert some of this crap.