In Private, Bernanke Tells Horror Stories-"Much Worse Than He Has Admitted To Publicly"

[kpete]

In Private, Bernanke Tells Horror Stories

January 22, 2008 04:46 PM ET | Bedard, Paul |

People wondering why Federal Reserve Chairman Ben Bernanke suddenly moved to reduce the bank borrowing rate by three quarters of a point should know that in private he has expressed growing pessimism about the economy. Whispers has learned that has told people in recent weeks that the economic situation some see falling into recession will be much worse than he has admitted to publicly.

We're told by those who've heard him that he says the first six months of this year will be "bad," an adjective that some interpret this as signaling there is better than a 50-50 chance for a recession. Even worse, the former Princeton prof believes the ensuing recovery will be "weak" because of persistent problems in the housing market that will result in subdued consumer spending. We checked in with his office, which says it doesn't comment on what the boss says in private. But it's certainly not comforting news considering that his recent public testimony was a bummer, like when he told Congress last week, "Recently, incoming information has suggested that the baseline outlook for real activity in 2008 has worsened and that the downside risks to growth have become more pronounced ... in particular, a number of factors, including continuing increases in energy prices, lower equity prices, and softening home values, seem likely to weigh on consumer spending as we move into 2008."

more at:
http://www.usnews.com/blogs/washington-whispers/2008/1/22/in-private-bernanke-tells-horror-stories.html

[villager]

1. Bernanke's boss: The turd in the world's punchbowl...

n/t

[midnight]

7. The turd in the world's punchbowl...

Thanks for the laugh.

[tekisui]

2. Thanks, ben.

[MichiganVote]

3. Well when your government is out buying the world with guns and ammo it gets expensive.

[aquart]

5. You sure we actually make that stuff?

If we do, it's all we do make.

[MichiganVote]

14. Beats me. Maybe we should ask China.

[aquart]

4. There will be no hope till a Dem wins.

And THEN we need immediate moves on healthcare (universal single payer healthcare will make every American business more competitive --with the possible exception of the insurance companies) and energy
independence (say a federal jobs program to green the nation? or to rehabilitate and build housing for returning service members?)ANYTHING that will actually stimulate movement and growth and innovation. NOT just handing free money to already bloated corporations which is what the interest rate cut does.

[martymar64]

6. To expand on your point

I'm starting to think that whoever wins the WH is going to have to go into crisis mode right away just to avoid an economic collapse on the scale of the Soviet collapse. Even a moderate will be forced by circumstances to enact New Deal size projects to simply prevent violent upheaval in the US resulting from a Great Depression size event. Zinn once said (I paraphrase) that FDR enacted the New Deal in order to save capitalism against revolution. This may be another replay of that scenario.

[aquart]

8. Change will be forced on us no matter who wins.

We don't have anything that will let us continue as we are.

And change pisses people off. The president will get the blame. Why is anyone running for this job again?

The mess is mindboggling. And I still remember being told, over seven years ago, "How much harm can he do?"

[KillCapitalism]

11. Let's hope people discard capitalism altogether this time.

If this happens to be the second great failure of capitalism, I hope that people will seriously look at other alternatives.

[7 of 11]

13. Capitalism works when properly applied

It's runaway capitalisms that is lethal. Having people do what ever they want to do to make as much money as possible is as dangerous as removing all traffic laws in L.A. during rush hour traffic. It would make absolutely no sense, and that is what Bushit-co has been dong in America for the past seven years.

Capitalism is the best that we have when strict rules are applied and ENFORCED regularly and equally

[slipslidingaway]

9. Agree, that is why I support Kucinich, this is what he is saying. n/t

[knitter4democracy]

10. Only some think we're in a recession?!

What the heck is wrong with them? Where do they live? Tell them to come to Michigan and tell us we're only maybe in a recession.

[WinkyDink]

12. When was it again that Bill Clinton was President? Bush has destroyed the United States.

[bdamomma]

15. yes, * destroyed the US, he's psychotic and he needs to be

removed and incarcerated for his numerous crimes. Every dog has its day, hope it is soon.

[truthisfreedom]

17. It might be easier to have him committed than incarcerated.

[Skittles]

16. it seems like several decades ago now

the bush years have been exceedingly painful and the pain will continue for decades