Bernanke Signals Fed Will Keep Stimulus in Place
Fed Chairman Ben Bernanke tells Congress that the U.S. job market remains weak and that it is too soon for the central bank to end its extraordinary stimulus program.
Fed Chairman Ben Bernanke tells Congress that the U.S. job market remains weak and that it is too soon for the central bank to end its extraordinary stimulus program.
Federal Reserve policymakers are divided over when to end extraordinary measures intended to encourage more borrowing and spending to help stimulate the U.S. economy.
Facing criticism from Republican lawmakers, Chairman Ben Bernanke stood behind the Federal Reserve's low-interest-rate policies Wednesday and sought to reassure Congress that the central bank has a handle on the risks. Bond purchases are needed to help boost a still-weak economy, Bernanke said.
Futures are rising as Chairman Ben Bernanke heads to Capitol Hill to explain what the Federal Reserve will do to accelerate the economic recovery only days before a series of mandatory budget cuts kick in.
The Federal Reserve says it will keep spending $45 billion a month to sustain an aggressive drive to keep long-term interest rates low, with the express purpose of hitting the accelerator on economic growth until unemployment drops below 6.5 percent.
With a nervous eye on the "fiscal cliff," the Federal Reserve is expected this week to announce a new bond-buying plan intended to further reduce long-term interest rates and encourage borrowing. If it succeeds, it might soften the blow from tax increases and spending cuts that will kick in in January if Congress can't reach a budget deal.
August's sluggish job growth could slow the momentum President Barack Obama hoped to gain from his speech Thursday night; it could also make the Federal Reserve more likely to unveil a new bond-buying program at its meeting next week.
The last time the stock market was this high, the Great Recession was turning a month old, and stocks were pointed toward a headlong descent. But on Thursday, the market moved swiftly in the other direction.
When a Federal Reserve committee meets Tuesday to consider the federal interest rate, it will likely revise its glum outlook into something brighter. But will it also acknowledge the U.S.'s growing inflation problem?
The U.S. services sector is growing strong, providing additional evidence that the U.S. economy is recovering and might not need more stimulus funding. But that's contingent upon oil staying below $120 per barrel.
The Federal Reserve is doling out billions to buy bonds in hopes of keeping interest rates low and stimulating the economy. However, several powerful forces are working against that low-rate strategy, ranging from investor psychology to global competition for capital.
Silver prices touched a 30-year high Monday as investors sought the safety of precious metals. Inflation concerns are running high after Fed Chairman Ben Bernanke said the central bank is considering a third round of qualitative easing.
Some of the best reads for investors from around the Web, including posts evaluating how consumers spend their money, whether Google could be considered a monopoly and the debate about the Fed's policy on quantitative easing.
After initially voting for the QE2 plan, Federal Reserve Governor Kevin Warsh said in a speech Monday that the government's decision to buy $600 million worth of bonds to spur the economy is a bad idea.











