Bernanke walks fine line in Congress
Fed Chair Ben Bernanke took the administration's mortgage bailout plan to the Senate Banking Committee members Tuesday and will be back on Capitol Hill today. John Dimsdale reports on what Bernanke is up against.
Federal Reserve Board Chairman Ben Bernanke testifies during a hearing before the Senate Banking, Housing and Urban Affairs Committee. (Alex Wong/Getty Images)
More on The Economy, Wall Street, Politics, America's Financial Crisis
TEXT OF STORY
Scott Jagow: Meanwhile, the bailout dream team -- Mr. Bernanke and Mr. Paulson -- are pushing Congress on the $700 billion plan. Bernanke will be back on Capitol Hill this morning to talk about the economy in general. John Dimsdale has more.
John Dimsdale: Judging from Chairman Bernanke's comments before the Senate Banking committee yesterday, he's kinda worried about the economy.
Ben Bernanke: The financial markets are in quite fragile condition. Credit is not being provided. This will be a major drag on the U.S. economy and will greatly impede the ability of the economy to recover in a healthy way.
But while he's urging fast action on the rescue plan, the Federal Reserve chairman has to be careful just how dire his economic forecast is, says former Fed Governor Lyle Gramley.
Lyle Gramley: He certainly wants to impress upon them the need for going ahead with his program quickly so we can shore up confidence in financial markets. On the other hand he doesn't want to scare financial markets so badly that more disruption occurs.
Gramley says Bernanke has to press Congress on the urgency of a bailout without further undermining bank confidence that loans will be repaid.
In Washington I'm John Dimsdale for Marketplace.
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From WI, 09/24/2008
Well lets see…greed, fraud, lies, each man only for himself…(be he banker, buyer, realtor, FDIC chairman, the head of the Treasury, President, politician, each citizen)… Are these things wrong or does each person decide them for himself.....They have resulted in = loss of freedom, people being hurt, anger, disillusionment, confusion, despair, violence,…I don’t think everyone gets to choose…I think if we are to have freedom, hope, peace, people not hurting others, we all have to agree to live by established laws and moral principles….regulation is needed and needs to be enforced as people are not inherently honest, good, considerate of others….My prayers for us all…
09/24/2008
It is very easy to write a speech according to what you want to sell. Bernanke wants to sell bailout to congress, so he wrote economy is in bad shape.
Just two weeks back Federal reserver FOMC meeting released a statement with following quote:
"Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth."
So Bernanke changes his opinion as it suits him.
Just today morning while listening to radio, there were several commercials trying pich mortgage refinancing. Todays newspayer had several car dealer advertisements with low interest loans. This does not look like credit markets being frozen. For this looks like investment banks have bad loans and they just want offload on to tax payer and move on to next scheme. In this whole bailout there no talk of regulating credit default swaps or reducing leverage ratio for investment banks. The only thing i see is to sow seeds for next bubble.
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