Live Webcast Of Bernanke Testimony To Congress
- Agency MBS
- Ben Bernanke
- Borrowing Costs
- Central Banks
- Consumer Sentiment
- Federal Reserve
- fixed
- Greece
- Gross Domestic Product
- House Financial Services Committee
- Japan
- Market Conditions
- Maxine Waters
- Monetary Policy
- Personal Consumption
- Purchasing Power
- Recession
- recovery
- Testimony
- Transparency
- Unemployment
- Unemployment Insurance
Today's second most important event is the testimony of Bernanke before the House Financial Services Committee (yes, Maxine Waters will be there). Lawmakers will question him about the Fed's plans on avoiding inflation and the current unemployment rate. Committee members are also expected to inquiry about fiscal policy, the status of the nation's economic recovery, the impact of rising gas prices, and the debt crisis in Europe. Most importantly, Benny will be asked to testify on when more QEasing is coming as the markets need their fix. Watch it live at C-Span after the jump.
Testimony Highlights:
- BERNANKE SEES `POSITIVE DEVELOPMENTS IN THE LABOR MARKET'
- BERNANKE: GAS PRICES LIKELY TO TEMPORARILY PUSH UP INFLATION
- BERNANKE: UNEMPLOYMENT `ELEVATED,' PRICE OUTLOOK `SUBDUED'
- BERNANKE SAYS HIGHLY ACCOMMODATIVE STANCE MEETS BOTH FED GOALS
- BERNANKE SAYS FALL IN UNEMPLOYMENT `MORE RAPID' THAN EXPECTED
- BERNANKE SAYS `THE JOB MARKET REMAINS FAR FROM NORMAL'
- BERNANKE SAYS `CRITICAL' CHALLENGES REMAIN FOR EURO ZONE
Full Testimony (link)
Semiannual Monetary Policy Report to the Congress
Before the Committee on Financial Services, U.S. House of Representatives, Washington, D.C.
February 29, 2012
Chairman Bachus, Ranking Member Frank, and other members of the Committee, I am pleased to present the Federal Reserve's semiannual Monetary Policy Report to the Congress. I will begin with a discussion of current economic conditions and the outlook and then turn to monetary policy.
The Economic Outlook
The recovery of the U.S. economy continues, but the pace of expansion has been uneven and modest by historical standards. After minimal gains in the first half of last year, real gross domestic product (GDP) increased at a 2-1/4 percent annual rate in the second half.1 The limited information available for 2012 is consistent with growth proceeding, in coming quarters, at a pace close to or somewhat above the pace that was registered during the second half of last year.
We have seen some positive developments in the labor market. Private payroll employment has increased by 165,000 jobs per month on average since the middle of last year, and nearly 260,000 new private-sector jobs were added in January. The job gains in recent months have been relatively widespread across industries. In the public sector, by contrast, layoffs by state and local governments have continued. The unemployment rate hovered around 9 percent for much of last year but has moved down appreciably since September, reaching 8.3 percent in January. New claims for unemployment insurance benefits have also moderated.
The decline in the unemployment rate over the past year has been somewhat more rapid than might have been expected, given that the economy appears to have been growing during that time frame at or below its longer-term trend; continued improvement in the job market is likely to require stronger growth in final demand and production. Notwithstanding the better recent data, the job market remains far from normal: The unemployment rate remains elevated, long-term unemployment is still near record levels, and the number of persons working part time for economic reasons is very high.2
Household spending advanced moderately in the second half of last year, boosted by a fourth-quarter surge in motor vehicle purchases that was facilitated by an easing of constraints on supply related to the earthquake in Japan. However, the fundamentals that support spending continue to be weak: Real household income and wealth were flat in 2011, and access to credit remained restricted for many potential borrowers. Consumer sentiment, which dropped sharply last summer, has since rebounded but remains relatively low.
In the housing sector, affordability has increased dramatically as a result of the decline in house prices and historically low interest rates on conventional mortgages. Unfortunately, many potential buyers lack the down payment and credit history required to qualify for loans; others are reluctant to buy a house now because of concerns about their income, employment prospects, and the future path of home prices. On the supply side of the market, about 30 percent of recent home sales have consisted of foreclosed or distressed properties, and home vacancy rates remain high, putting downward pressure on house prices. More-positive signs include a pickup in construction in the multifamily sector and recent increases in homebuilder sentiment.
Manufacturing production has increased 15 percent since the trough of the recession and has posted solid gains since the middle of last year, supported by the recovery in motor vehicle supply chains and ongoing increases in business investment and exports. Real business spending for equipment and software rose at an annual rate of about 12 percent over the second half of 2011, a bit faster than in the first half of the year. But real export growth, while remaining solid, slowed somewhat over the same period as foreign economic activity decelerated, particularly in Europe.
The members of the Board and the presidents of the Federal Reserve Banks recently projected that economic activity in 2012 will expand at or somewhat above the pace registered in the second half of last year. Specifically, their projections for growth in real GDP this year, provided in conjunction with the January meeting of the Federal Open Market Committee (FOMC), have a central tendency of 2.2 to 2.7 percent.3 These forecasts were considerably lower than the projections they made last June.4 A number of factors have played a role in this reassessment. First, the annual revisions to the national income and product accounts released last summer indicated that the recovery had been somewhat slower than previously estimated. In addition, fiscal and financial strains in Europe have weighed on financial conditions and global economic growth, and problems in U.S. housing and mortgage markets have continued to hold down not only construction and related industries, but also household wealth and confidence. Looking beyond 2012, FOMC participants expect that economic activity will pick up gradually as these headwinds fade, supported by a continuation of the highly accommodative stance for monetary policy.
With output growth in 2012 projected to remain close to its longer-run trend, participants did not anticipate further substantial declines in the unemployment rate over the course of this year. Looking beyond this year, FOMC participants expect the unemployment rate to continue to edge down only slowly toward levels consistent with the Committee's statutory mandate. In light of the somewhat different signals received recently from the labor market than from indicators of final demand and production, however, it will be especially important to evaluate incoming information to assess the underlying pace of economic recovery.
At our January meeting, participants agreed that strains in global financial markets posed significant downside risks to the economic outlook. Investors' concerns about fiscal deficits and the levels of government debt in a number of European countries have led to substantial increases in sovereign borrowing costs, stresses in the European banking system, and associated reductions in the availability of credit and economic activity in the euro area. To help prevent strains in Europe from spilling over to the U.S. economy, the Federal Reserve in November agreed to extend and to modify the terms of its swap lines with other major central banks, and it continues to monitor the European exposures of U.S. financial institutions.
A number of constructive policy actions have been taken of late in Europe, including the European Central Bank's program to extend three-year collateralized loans to European financial institutions. Most recently, European policymakers agreed on a new package of measures for Greece, which combines additional official-sector loans with a sizable reduction of Greek debt held by the private sector. However, critical fiscal and financial challenges remain for the euro zone, the resolution of which will require concerted action on the part of European authorities. Further steps will also be required to boost growth and competitiveness in a number of countries. We are in frequent contact with our counterparts in Europe and will continue to follow the situation closely.
As I discussed in my July testimony, inflation picked up during the early part of 2011.5 A surge in the prices of oil and other commodities, along with supply disruptions associated with the disaster in Japan that put upward pressure on motor vehicle prices, pushed overall inflation to an annual rate of more than 3 percent over the first half of last year.6 As we had expected, however, these factors proved transitory, and inflation moderated to an annual rate of 1-1/2 percent during the second half of the year--close to its average pace in the preceding two years. In the projections made in January, the Committee anticipated that, over coming quarters, inflation will run at or below the 2 percent level we judge most consistent with our statutory mandate. Specifically, the central tendency of participants' forecasts for inflation in 2012 ranged from 1.4 to 1.8 percent, about unchanged from the projections made last June.7 Looking farther ahead, participants expected the subdued level of inflation to persist beyond this year. Since these projections were made, gasoline prices have moved up, primarily reflecting higher global oil prices--a development that is likely to push up inflation temporarily while reducing consumers' purchasing power. We will continue to monitor energy markets carefully. Longer-term inflation expectations, as measured by surveys and financial market indicators, appear consistent with the view that inflation will remain subdued.
Monetary Policy
Against this backdrop of restrained growth, persistent downside risks to the outlook for real activity, and moderating inflation, the Committee took several steps to provide additional monetary accommodation during the second half of 2011 and early 2012. These steps included changes to the forward rate guidance included in the Committee's post-meeting statements and adjustments to the Federal Reserve's holdings of Treasury and agency securities.
The target range for the federal funds rate remains at 0 to 1/4 percent, and the forward guidance language in the FOMC policy statement provides an indication of how long the Committee expects that target range to be appropriate. In August, the Committee clarified the forward guidance language, noting that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--were likely to warrant exceptionally low levels for the federal funds rate at least through the middle of 2013. By providing a longer time horizon than had previously been expected by the public, the statement tended to put downward pressure on longer-term interest rates. At the January 2012 FOMC meeting, the Committee amended the forward guidance further, extending the horizon over which it expects economic conditions to warrant exceptionally low levels of the federal funds rate to at least through late 2014.
In addition to the adjustments made to the forward guidance, the Committee modified its policies regarding the Federal Reserve's holdings of securities. In September, the Committee put in place a maturity extension program that combines purchases of longer-term Treasury securities with sales of shorter-term Treasury securities. The objective of this program is to lengthen the average maturity of our securities holdings without generating a significant change in the size of our balance sheet. Removing longer-term securities from the market should put downward pressure on longer-term interest rates and help make financial market conditions more supportive of economic growth than they otherwise would have been. To help support conditions in mortgage markets, the Committee also decided at its September meeting to reinvest principal received from its holdings of agency debt and agency mortgage-backed securities (MBS) in agency MBS, rather than continuing to reinvest those proceeds in longer-term Treasury securities as had been the practice since August 2010. The Committee reviews the size and composition of its securities holdings regularly and is prepared to adjust those holdings as appropriate to promote a stronger economic recovery in the context of price stability.
Before concluding, I would like to say a few words about the statement of longer-run goals and policy strategy that the FOMC issued at the conclusion of its January meeting. The statement reaffirms our commitment to our statutory objectives, given to us by the Congress, of price stability and maximum employment. Its purpose is to provide additional transparency and increase the effectiveness of monetary policy. The statement does not imply a change in how the Committee conducts policy.
Transparency is enhanced by providing greater specificity about our objectives. Because the inflation rate over the longer run is determined primarily by monetary policy, it is feasible and appropriate for the Committee to set a numerical goal for that key variable. The FOMC judges that an inflation rate of 2 percent, as measured by the annual change in the price index for personal consumption expenditures, is most consistent over the longer run with its statutory mandate. While maximum employment stands on an equal footing with price stability as an objective of monetary policy, the maximum level of employment in an economy is largely determined by nonmonetary factors that affect the structure and dynamics of the labor market; it is therefore not feasible for any central bank to specify a fixed goal for the longer-run level of employment. However, the Committee can estimate the level of maximum employment and use that estimate to inform policy decisions. In our most recent projections in January, for example, FOMC participants' estimates of the longer-run, normal rate of unemployment had a central tendency of 5.2 to 6.0 percent.8 As I noted a moment ago, the level of maximum employment in an economy is subject to change; for instance, it can be affected by shifts in the structure of the economy and by a range of economic policies. If at some stage the Committee estimated that the maximum level of employment had increased, for example, we would adjust monetary policy accordingly.
The dual objectives of price stability and maximum employment are generally complementary. Indeed, at present, with the unemployment rate elevated and the inflation outlook subdued, the Committee judges that sustaining a highly accommodative stance for monetary policy is consistent with promoting both objectives. However, in cases where these objectives are not complementary, the Committee follows a balanced approach in promoting them, taking into account the magnitudes of the deviations of inflation and employment from levels judged to be consistent with the dual mandate, as well as the potentially different time horizons over which employment and inflation are projected to return to such levels.
Thank you. I would be pleased to take your questions.
(5 votes)
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It would be great if he came out and said, "you know what? I really do not know what the fuck I am doing"
Unfortunately he knows EXACTLY what the fuck he is doing ....
True, bought and paid for.
Sup, bitchez.
Off topic (well kinda on-topic given that this thread is about fiat debasement) but someone was asking a couple days ago about Berkshire Hathaway priced in gold.
Well, I did it.
Looks back for Warren, bitchez
http://azizonomics.com/2012/02/29/warren-buffett-priced-in-gold/
The plan is *looks around* their is no plan
THAT is the plan
"How many fingers, Winston?"
3.0 I see it now.
love the stupid latina old bitch Nydia asking questions that have been written for her to read
its "would" not "wool" Nydia
School before congress is not a bad idea
Shaky McShakes Bernank Twitch-A-Lot Testimony Drinking Game
The drinking words for today are 'transitory,' 'temporary' & 'sustainable'
Must be at least 80 proof.
'Price stability' is the bonus phrase, and also requires drinking a shot.
Good luck, bitchez.
hahaha!
Brilliant Ron Paul silver store of value speech!
brilliant content of speech, but lousy delivery...paul was preaching and brash....bernanke was cool
bernanke's first response back was light and sensible saying hello to mr paul and acknowledging that everyone has right to own silver, gold or other currencies....purposely calming words to paul and telling him if thats what you believe, then buy silver
bernanke made paul look cranky, eccentric and slightly crazy
sorry ZHers, but paul looked the fool
Hard1.................paul is not the right messenger....politics takes eloquence
Is that what you call miles-deep layers of bullshit?
let me rephrase.....i have to force myself to listen to ron paul to hear the great words
Sure ... did he expect the US to lose there AAA credit rating? For the US to lose the reserve currency status(which is in the making)? I'd bet he didn't foretell any of this happening.
Ben Prints a boat load of money that cause inflation.
The Neocons invade Iran which sends oil to $200.
Ben blames inflation on the price of oil (im lovin it)
I hate the F*** Bastard Bernanke, screw you f***face
Unfortunately for us, fortunately for him and his masters.
When was the last time you heard a PH.D economist come out and day "i really don't know what the fuck i am doing"?
When pigs fly and hell freezes over.
Legitmacy is derived from credibility. Credibility comes from being a member of the "club". Right school, right degree, right peer group, "right" being the buzzword. Note - credibility doesn't come from being the best. In this enviroment being the best, would mean going against generally accepted wisdom of the peer group and get one fired.
Remember: Elites Only Fail Upward
(See: The Rubin Principle)
The failure of the US economic "expert" class is almost as great as the failure of the incompetent, corrupt US political class...
PH.D
today stands for " Popa Has Dough"
They know what the fuck they are doing battle, they are running this circus!!
It will come to an end, RON is Bashing the mother fucker.
Ron Paul stated he believed the Fed would break apart on its own. I don't agree. The United States may be a bankrupt government, go through re-organization and be broken apart first. Defense and entitlement spending are so far out of control either Washington politicians break the promises and tell the people they were lied to or the Fed (which violated its independence and IS defacto government) prints.
In the event the U.S. breaks apart, there wouldn't be a Central Bank afterward, likely three total regions and regional banks. I just make a guess based on physics as to the amount of regions, not someone's stated plans (such as ten NWO regional governments and governors).
To others thinking of the U.S.A. losing the peg. I believe this is a common fallacy. The formation of SDR's in 1971 correlates to Nixon going to China. China becoming the reserve currency is a FEATURE, not a BUG. And understand that being the reserve currency for the globe means being the global policeman.
Didn't you think it was beyond bizarre China wound up such a hefty share of Iraq oil contracts considering America nailed down the entire country at a cost into the trillions and thousands of lives lost?
Iran is next and China will be the global policeman afterward. 2014 will be the year China officially becomes the reserve currency and the following year we'll see China demonstrate its military muscle in its new role. I believe geopolitical conflicts will arise with America, China and Russia all vying for the last empire. The strategic relationship of China being manufacturing muscle, currency peg and backed by Russia won't last. These two countries historically hate each other. But enough of my own opinion. I am curious in what others have to say.
what a shame ron paul wont be president of the US. You guys are going to get the President you desrerve
Dr. Paul just waved a silver round in Bitch Bernank's face & told him he can buy 3x the amount of gasoline with it now than when The Bernank began his circus act!
Then Paul laughed and said "[c]ongress need not revoke the Federal Reserve Act, because the Federal Reserve is going to implode soon on its own initiative."
Gave me a raging boner!
Yep that was awesome
Oh God, I missed it. Anyone have video link?
Video link (starts at 0:50 seconds in):
https://www.youtube.com/watch?feature=player_embedded&v=H4uL6CSiGrU
Thanks!
I agree with just about everything Ron Paul said with the exception of his comment about the Fed destroying itself. That will not happen for a variety of reasons. Unfortunately, Mr. Paul also came across as a little bit of a rambler who just wanted to make a speech instead of engaging in dialogue.
Politicians should also be statesmen who try to build concensus with people who may be sympathetic or tolerant of their cause. Quid pro quo. As much as I sympathize with his ideas, he appears to go out on a limb and start sawing on the limb aggressively in public.
Ben Bernanke is neck deep in the status quo, and he cannot change his fundamental approach given his mandate. If he tried, he would be replaced immediately. Right now, Ron Paul and the Fed can't even agree on the data, much less the solution.
It is important with engagement to deal in specificities, and let the facts speak. If the facts speak, it begs new questions which need to be answered. While I support many of Ron Paul's policies, it is frustrating to listen to him ramble, stutter, and not engage the Fed Chairman and indeed the listeners with coherent reasonable questions. THAT would put the Fed out on the branch, and hand them their own saw with which they would begin to cut.
JEB BUSH?????
Or Donald Trump
Let me get my Jesus cross out Knight 99 to go with your hooded purpose. Certainly we Americans must be hung for failing to individually raise a few hundred million each and buy out our government. I guess the real people who did that get a message, a cigar and a BJ eh? Send us that cross, we're too broke to buy our own, although with this justice system they make you buy your own nails.
PS: Go fuck yourself.
Jason:
Take a deep breath ... step away from the keyboard.
Go take a long walk ... get some fresh air.
Your PS sounds like SmokeyQuinn.
Ha! I have taken some walks David. Good for the heart and mind.
Quinn had a habit of calling Americans morons. Knight 99 was doing the same thing, blaming the victims.
So should I stay silent as the rape victim get's strangled? Those park rapists sure don't like leaving evidence lying around now do they?
PS: I pick my battles
Hahaha OMG I am literally crying with laughter!! +100000 for that comment sir! So funny
I was expecting the Bernanke , the man with the golden tongue to give me a goldasm....instead , all I got was a dirty Sanchez.
I vote we replace the term "Hot Karl" with "Hot Bernanke" in the Urban Dictionary.
can someone please throw a hot bag of steaming shit at this fucker's face?
lol
How would we know if we did?
Anyone just see that 75 cent swing in Silver that happened in just seconds? Cocksuckerz!
take a look at gold. maybe tyler tweeted something about margin hike rumors lol
The drop was on the release of Bernanke's prepared statements.
TheSilverJournal.com
Comex crime scene.
... and gold is now down 15 bucks ... I guess crude is next ...
Blythe's monkies jumping up and down on their desks, shreiking and throwing dung. They will fail.
Just wait till The Bernanke starts talking. The take down was used to accomodate the Bernanke induced gold rally.
When Ron spoke it dropped from 1784 to 1773 in a flash second!
Dont tell me that was Supply/Demand!
Bernanke pushed the takedown button on his secret decoder ring.
"Anyone just see that 75 cent swing in Silver that happened in just seconds? Cocksuckerz!"
pure coincidence....now, have some more debt coupon dollars and like them.....
Leap Day and Maxine Waters.
Really today is AWESOME.
On a serious note did anyone actually think The Bernank, would become less accomdative in the face of ECB printing over EUR1T in 3 months. This isn't about dual mandate it is about making sure the USD stays weak, for yank exports to the island of misfit toys.
Maxine Waters:
"Ben if you would please explain ..... the connections between you and the mega banks .....there seems to be a lot of connections... and I think many Wall Streeters are connected to you and others.... Ben would please explain the connections..."
Maxine Waters
LOL! Employment Improvment...that's funny.
I can not wait to hear some crazy shit out of Maxine Water's mouth, that women cracks me up. Come on Maxine, don't disappoint!!!!
It's great comfort having a mind like that on our side!
You only say that because she, like Sheila Jackson Lee is ...... truly stupid.
Damn! You got me.
I see no mention of rainbows and unicorns. The "dual mandate" and "dual objectives" are unclear as well.
the dual mandate is 1). spike the stock market and 2). shove as much money as possible into the banks ... what's so unclear about that?
His tiny testicles are in a vise. Keep easing and watch $8 gas, or tighten and watch DOW 6000, and bond market implode.
This is what printing gets you Uncle Ben.
Dow 15,000
The money has to go somewhere, so why not bid up the winners. The United Corporations of America.
That said I still I wouldn't buy it own Principle alone. Do you know what that means Tyler? Principles.
NOT the money of a loan. But sheer principles alone.
As usual, XRT is unfazed by the gyrations in the metals and currencies.
Buzzword of the day: acomodate.
No promises, just more ZIRP. Possible until Jesus comes back, wich is when The Bernank raises rates to tank the market. That way the second coming is viewed unfavorable to the market and the EU will forbid it, just like they did with shorting financials.
Ben Shalom Bernanke is Jewish. I seriously doubt he is planning anything around the second coming of Jesus.
I, on the other hand, have very little left to hang my hat on ...
What Ron Paul should be saying:
" I am also like yourselves sick and tired of the Zionists and BANKSTERS running this country into the ground. Therefore if I am electedPresident, I will prepose that the your MORTGAGE is paid in FULL. And if the BANKSTERS dont like that, then its time to NATIONALIZE them. And the backing of the new currency shall be the housing stock of the USA and if you live in a house, it is now yours FREE and clear. That ought a clear the market."
President Ron Paul
.........because owning a home is a basic human right.............right? I think you've confused Ron Paul with Uncle Mittens.
Go ahead and use the term "zionists." It doesn't help your postion, but go right ahead. Use of terms like that allows big government types to belittle people who believe there are serious problems with this country's currency and banking system. It is much better for them if they can paint all of us as racists and buffoons.
So thanks for the help.
Truth is what it is. Zionism is very bad & people who get it say so honestly. Ron Paul gets it but... to win over Republicans said he defends zionism - just not to the point of funding it.
Please G_d.
Please let Islamo-fascist ass-clowns parachute out of the sky and machine gun this circus of scheming thieves.
Please bring relief to our weary country.
Make our national nightmare end.
We oPpose DECEPTION.
"YOU " are a fucking LIAR and a THIEF Ben Bernanke.
Barney Frank says bring the troops home from Afg and stop subsidizing NATO. Alright, alright, alright!
Please who are his masters ?
Who owns the FED ?
Blythe throwing a temper tantrum. Meanwhile, the F12-punching GATA monkeys are punching out.
Too much leverage, too many guys playing in the futures market, as usual.
Bachus: Ron Paul, thorn in the flesh.
RON!!!!!!!!!
...and Helicopter Ben is testifying to Barney "Fannie/Freddie" Frank.
The shit is surreal :(
If everything goes well Barney is going to (in his own words) "Take all of you up my fat ass Benny baby".
PMs are tanking as I type. Have to keep up appearances.
Europe just TARP'd themselves $787b. What do you think they will do with the liquidity? They have to get the price of PM lower, it is their mandate by proxie, so to keep the value of fiat strong.
I don't think it will last very long and it will be very expensive for them. Expensive for the gov is good, because Fed/Treasury gold losses are the same as money printing. They lose gold backing and/or they print money to cover losses. Plus, gold would never go down if they didn't do this nonsense and we would never get a good entry point.
Bawknee Fwank: Wibba wabba, jibba jabba, baw pawtwasin wibba wabba.
Bernanke: Uhm....no....uh....transtory.....uh.....
Fwank: Can wee cuntinue dith debate when dee opotunitee wibba wabba.
Bernanke: Uh......uh.....uhm.....
Sweet! Ron Paul, bitchez!
Go Ron. We love you man.
Barney Frank = Bank Near Fry
IT was 1786 when Ron SPOKE
FUCK TPTB!!!
Gold and Silver dropping! The markets must have found new confidence in the Bernank's wishy washy bullshit statements.
It's all rigged JFK, ALL OF IT