politicalmusings
Political Musings

Federal Reserve is ready to act to ensure smooth markets

Wed Dec 08, 2010 2:54 pm
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Comments: 1 Views: 1654

U.S. Financial Markets are healthier, but a full recovery will take time and the Federal Reserve will act as needed to support market stability as well as sustainable growth and stable prices, Federal Reserve Chairman Ben Bernanke said on Monday.

"Conditions in Financial Markets have shown improvement since the worst of the storm in Mid-August, but a full recovery of Market functioning is likely to take time, and we may well see some setbacks," Bernanke said in remarks prepared for delivery to the New York Economic Club.

The Federal Reserve meets again October 30-31 and markets see a 32% chance that policy makers will cut benchmark overnight borrowing costs by a quarter percentage point.

Ben Bernanke further said the Fed would keep close watch on employment and labor income, since any income gains would support consumer spending even if home values stagnate or fall. 

The long and the short of this issue with the Federal Reserve and the Markets is analogous to one family having exceeded their income (spending themselves in oblivion) and another family who has lived within their means being asked to bail out the family who did not look at the consequences of their actions.  

The Federal Reserve is incrementally and erroneously acting to bail out those individuals and businesses that acted without looking at the risks involved.

Comments, opinions................. 



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Fri Nov 12, 2010 6:08 am
Name: f@m()Us_m!$+al

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