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发帖数: 1054 | 1 Federal Reserve Chairman Ben S. Bernanke said U.S. unemployment may take
five years to fall to a normal level and that Fed purchases of Treasury
securities beyond the $600 billion announced last month are possible.
“At the rate we’re going, it could be four, five years before we are back
to a more normal unemployment rate” of about 5 percent to 6 percent,
Bernanke said according to the transcript of an interview to air today on
CBS Corp.’s “60 Minutes” program.
The purchase of more bonds than planned is “certainly possible,” said
Bernanke, 56. “It depends on the efficacy of the program” and the outlook
for inflation and the economy.
Bernanke and other Fed officials have defended the central bank’s
announcement that it will purchase $75 billion in Treasury securities a
month through June to prop up a recovery so weak that only 39,000 jobs were
created in November. The unemployment rate last month rose to 9.8 percent,
the highest level since April, the Labor Department said on Dec. 3, three
days after the Bernanke interview.
The economy, which grew 2.5 percent in the third quarter, is so weak that
Bernanke said growth could fizzle out without support.
“It’s very close to the border,” he said. “It takes about 2.5 percent
growth just to keep unemployment stable and that’s about what we’re
getting. We’re not very far from the level where the economy is not self-
sustaining.”
Housing Market Depressed
Bernanke said a return to a recession “doesn’t seem likely” because
sectors of the economy such as housing can’t become much more depressed.
Still, a long period of high unemployment could damage confidence and is “
the primary source of risk that we might have another slowdown in the
economy.”
The Fed’s decision to undertake new bond purchases sparked a political
backlash in Washington. The program, known as quantitative easing, has been
criticized by officials in countries including China and Germany. A Nov. 15
letter from 23 people, including former Republican officials and economists,
urged the Fed to end the program early.
“The planned asset purchases risk currency debasement and inflation, and we
do not think they will achieve the Fed’s objective of promoting employment
,” they said.
Sarah Palin, the 2008 vice-presidential candidate who has said she’s
considering a run for president in 2012, wrote in a Nov. 18 letter to the
Wall Street Journal that “It’s time for us to ‘refudiate’ the notion
that this dangerous experiment in printing $600 billion out of thin air,
with nothing to back it up, will magically fix economic problems.”
Maximum Employment Mandate
Two Republicans, Tennessee Senator Bob Corker and Indiana Representative
Mike Pence, last month proposed removing the Fed’s maximum employment
mandate to focus the central bank on stable prices alone. Corker plans to
introduce such legislation next year.
Bernanke said fears of inflation are “overstated” and that keeping
inflation under control isn’t a diminished priority for the Fed.
The rate of inflation has slowed this year, with the personal consumption
expenditures index, excluding food and energy, rising at a 0.9 percent
annual pace in October, the slowest in 50 years. Including all items, the
index increased 1.3 percent.
Without action by the central bank, the economy might have tipped into a
period of deflation, or a prolonged drop in prices, Bernanke said.
“Because the Fed is acting, I would say the risk is pretty low” of
deflation, Bernanke said. “But if the Fed did not act, then given how much
inflation has come down since the beginning of the recession, I think it
would be a more serious concern.”
Totally Confident
Bernanke said he is “100 percent” confident that, when necessary, the
central bank can control inflation and reverse its accommodative monetary
policy.
“We’ve been very, very clear that we will not allow inflation to rise
above 2 percent,” he said.
“We could raise interest rates in 15 minutes if we have to,” he said. “So
, there really is no problem with raising rates, tightening monetary policy,
slowing the economy, reducing inflation, at the appropriate time.”
“That time is not now,” he said.
The Fed’s policy of purchasing Treasury securities shouldn’t be considered
simply printing money, Bernanke said.
“The amount of currency in circulation is not changing,” he said. “The
money supply is not changing in any significant way. What we’re doing is
lowering interest rates by buying Treasury securities.”
Expanded Reserves
The Fed has increased its balance sheet by expanding excess reserves at
banks. The Fed reports two measures of the money supply. M1 includes all
currency held by consumers and companies for spending, money held in
checking accounts and travelers checks. M1 has risen 6.9 percent in the past
year, compared to a 4.3 percent average increase since 2000, the Fed said
last week.
“By lowering interest rates, we hope to stimulate the economy to grow
faster,” Bernanke said. “The trick is to find the appropriate moment when
to begin to unwind this policy.”
Longer-term interest rates, which had been falling since April as the
economy slowed and speculation increased that the Fed would have to do more,
have risen since the Fed’s Nov. 3 announcement of the bond purchases.
The yield on the 10-year Treasury note has increased 44 basis points since
Nov. 3 to 3.01 percent on Dec. 3, while the 30-year Treasury yield has risen
27 basis points to 4.31 percent. A basis point is 0.01 percentage point.
First Televised Interview
Bernanke gave his first televised interview as Fed chief on “60 Minutes”
on March 15, 2009, near the lowest point for the stock market in more than a
decade. He said then that “green shoots” were beginning to appear in
financial markets. On March 9 of that year, the Standard & Poor’s 500
closed at 676.53, the lowest level since 1996.
Bernanke’s interview comes as Fed officials are undertaking their broadest
review of public communications in three years. Janet Yellen, the Fed’s
vice chairman, is chairing a subcommittee to ensure the public is “well
informed about monetary policy issues.”
Today’s “60 Minutes” interview was filmed in Columbus, Ohio, during a
visit in which Bernanke joined in a panel discussion at the Ohio State
University campus with business leaders, including Alan Mulally, president
and chief executive officer of Ford Motor Co. The gathering was part of a
series of public appearances and question-and-answer sessions by Bernanke
this year.
Bakery Tour
Bernanke appeared in a June question-and-answer session with Sam Donaldson,
the ABC News journalist, in Washington. In May 2010, Bernanke toured a
Philadelphia shipyard and a Tasty Baking Co. factory in a part of the city
that is being redeveloped. Bernanke also answered questions from college
students in Providence, Rhode Island, in October and in Jacksonville,
Florida, in November.
“This is just another way to try to get our messages out and try to talk
effectively about monetary policy,” St. Louis Fed President James Bullard
said in a Dec. 3 interview on C-Span television’s “Newsmakers” program
broadcast today.
“Since we’re in such an unusual situation, it looks like we’re going to
be here for a while, we probably need to think about ways to more
effectively communicate,” Bullard said. |
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