The Fed chairman said the central bank intends to be “forceful . . . in supporting a sustainable recovery.” With Europe’s financial crisis and the United States’ looming budget cuts and tax hikes posing major risks for the recovery, he said, economic growth is “far from satisfactory,” and he pledged the Fed will take additional steps to help the economy as needed.

As is common of Fed pronouncements, Bernanke hinted but offered no certainty of action to come. Still, the urgent tone of his remarks will leave investors disappointed if the Fed does not launch new stimulus at its Sept. 12-13 policymaking meeting. Investors seemed hopeful, with stocks trending up by about 1 percent in the early afternoon.

“We must not lose sight of the daunting economic challenges that confront our nation,” Bernanke said. “The stagnation of the labor market in particular is a grave concern, not only because of the enormous suffering and waste of human talent it entails, but also because persistently high levels of unemployment will wreak structural damage on our economy that could last for many years.”

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Filed under: * Culture-Watch • Globalization • * Economics, Politics • Economy • Consumer/consumer spending • Corporations/Corporate Life • Housing/Real Estate Market • Labor/Labor Unions/Labor Market • The Banking System/Sector • The Credit Freeze Crisis of Fall 2008/The Recession of 2007-- • The U.S. Government • Federal Reserve • * International News & Commentary • Europe • --European Sovereign Debt Crisis of 2010

1. tgs wrote: As if Mr. Bernanke’s actions haven’t already wreaked structural damage on our economy that WILL last for many years. September 2, 6:13 pm | [comment link]

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