Bernanke Predicted that Drawing Attention - By: Allan Michael Taylor

Federal Reserve annual economic symposium Aug. 27 in the United States, held in Jackson Hole, Wyoming, from the world by the central bank's financial officials attending the meeting. This will be a time when the U.S. economy in the recent negative news of the recovery efforts and further challenged the occasion, which Federal Reserve Chairman Ben Bernanke's high-profile public speech, is considered the assumption of more than 4 years since the Fed chairman in a speech the most important . Bernanke on the U.S. economic outlook and Fed policy to determine the set, not only affects Wall Street's nerves, and may affect other countries, monetary policy decisions.

Anxiety reduction in expected market

3 months ago, Americans have been looking forward to a "revival of the summer," the end but what they got is a series of disappointing data. Just before Bernanke speech, the U.S. Department of Commerce will be the second-quarter GDP growth down from 2.4% previously to 1.6%, 2.4% lower than required to lower the unemployment rate at least 2.5% economic growth rate, further Note down the value of the U.S. economy is expected to face difficulties. University of Michigan and Reuters survey released recently, as of the end of August, U.S. consumer confidence lower than expected, suggesting the decline in consumption. Previously published data, 27 the first time this week, although the number of applications for unemployment benefits declined over the previous two weeks, but still high at 47.3 million people, showed that a large number of corporate layoffs continue. In addition, the housing market in July close to free fall again. Lackluster economic data and further erode investor optimism, market anxiety increased, on the 26th, the Dow Jones index fell below 10,000 points psychological barrier again.

The current medium-term optimism disappointed

On the U.S. economic outlook, Bernanke is still given a "present disappointment, medium-term optimism," the mixed judgments, that the job market despite disappointing, but companies such as equipment and software investment will continue to grow steadily. He pointed out that caused the second quarter GDP growth was mainly attributable to reduced U.S. international trade deficit increased, while the deterioration of U.S. exports is a temporary phenomenon, there are particular reasons. The next few months, exports are likely to become a new growth point. Bernanke predicted the economy will continue to expand this year, economic growth will accelerate in 2011. He believes that, although the recent high unemployment rate hardly changed much, but the U.S. economy in 2011 contributed to continued growth, "the precondition has been in place", including the banks to lend, on the European sovereign debt crises reduce such concerns .

On Fed policy direction, Bernanke said that, if economic outlook has deteriorated significantly the central bank will consider taking all necessary measures, including massive equity Zhaiquan increase the monetary policy easing Du, supports current Sangshi momentum of economic recovery. This is actually a clear reaffirmation of the Federal Reserve policy meeting this month to take more substantial action on the "precondition." But he also acknowledged, although the Fed's internal "necessary to take action, to prevent the U.S. economy into recession, deflation or two" Zheyiyuanze agreement, but can not on further action, "Juti standard" Xing Cheng consensus. He said the Fed needs to balance the benefits of using these tools is more than its cost and risk.

This time his speech, Bernanke seemed to support the economy boosted market sentiment, the Dow Jones index closed up 164.84 points, 27 back on the 10,000-point level to 10,150.65 points, the highest since August 2nd biggest single-day rise.

Talking about the great pressure

However, many well-known economists believe Bernanke's views on the U.S. economy are too optimistic, in the "false picture of peace." Nobel laureate Paul Krugman said Bernanke is continuing his "white lies" that if they can not lower the unemployment rate, the U.S. economy in the coming months is likely to fall further. Former Federal Reserve vice chairman, Princeton University economics professor Alan • Brand that Bernanke stressed that further action to stimulate the economy should be weighed, showing the Fed has run out of powerful policy tool, like a trench in soldiers, go on a light machine guns, hand grenades, the only fight left bayonets and throwing stones. Has successfully predicted the current round of financial crisis, U.S. economist at Roubini believes that the Fed no matter what measures are unable to restore the U.S. economy next year or two around. He predicted, with the purchase tax and a series of fiscal stimulus measures of maturity, the end of inventory adjustments and other enterprises, and promote U.S. economic growth in the first half of the "wind" in the second half will become a "headwind" in the second half of the economic growth rate will be close to zero.

Currently, most economists still think the U.S. economy into recession, the possibility of secondary low, but that this possibility is increasing. As the midterm elections approaching, Congress into political stalemate, the Obama Administration to take further measures to contribute much to stimulate the economy, the Fed in fact faced with demands from the market and the Administration acted on increasing pressure. Bernanke in his speech, the Federal Reserve to lower people's expectations, said whether the Fed or any central banks are unable to handedly restore economic growth, need for other economic policy makers and the private sector to respond effectively. Analysts said Bernanke is hinting that political leaders to take measures to address the trade deficit and imbalances.

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