Monday, March 26, 2012

Bernanke on 'The Recovery'

Bernanke's not exactly enthusiastic.

...A wide range of indicators suggests that the job market has been improving, which is a welcome development indeed. Still, conditions remain far from normal, as shown, for example, by the high level of long-term unemployment and the fact that jobs and hours worked remain well below pre-crisis peaks, even without adjusting for growth in the labor force. Moreover, we cannot yet be sure that the recent pace of improvement in the labor market will be sustained. Notably, an examination of recent deviations from Okun's law suggests that the recent decline in the unemployment rate may reflect, at least in part, a reversal of the unusually large layoffs that occurred during late 2008 and over 2009. To the extent that this reversal has been completed, further significant improvements in the unemployment rate will likely require a more-rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies.  --quoted at CalcRisk

"Accomodative policies" has been interpreted as "QE3" (!!)--another debt-increaser.


J. Strupp said...

Disagree with the interpretation.

Bernanke has been clear that additional expansionary monetary policy in the absence of expansionary fiscal policy is not going to do much to improve our employment situation. IOW, ADDITIONAL QE would see diminished returns.

"accommodative" policies in this case, means the continuation of the status quo from the FED with the hope and prayer that Congress will accelerate spending (which isn't going to happen).

arman said...

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Anonymous said...

It's safe to say you're a bit more pessimistic than your Boy Ben. Whatever do you tell your friends after turning on them? Or do you just avoid them?

I have to say it's great the GOP leads off their news releases with recognition and applause for the incremental upticks in the economy. If we're lucky - maybe we'll be able to credit bush for the upcoming economic boom.

It's also reassuring to see grandad29's neo-con crusade to rein in gummint spending has reached a frazzled apex. How is it that the old feller forgets extolling big spending on tax cuts and "homeland security" for ten years at the expense of everything else. And now you trip the alarm that all the horses are loose from the stable?

Videri quam esse

Dad29 said...

I may be old, but I understand definitions.

"Tax Cuts" are not "Spending."

Statists usually have tells; that's yours.