This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Bernanke: Job Situation 'Far from Normal'

NEW YORK ( TheStreet) -- U.S. Federal Reserve Chairman Ben Bernanke said Tuesday the country's job situation is "far from normal" and that accommodative monetary policies cannot be lifted yet.

Speaking at the International Monetary Conference in Atlanta, Bernanke said the fuzzy employment picture, including the growing ranks of the long-term unemployed, is still a big question mark for the U.S. economy.

"Although it is moving in the right direction, the economy is still producing at levels well below its potential; consequently, accommodative monetary policies are still needed," he said. "Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established"

Federal Reserve Chairman Ben Bernanke

Bernanke said he expects accommodative monetary policies to continue once the Fed's current $600 billion bond-buying program, known as "QE2," wraps up at the end of this month. The fed funds rate will remain at "exceptionally low levels," he added.

He also acknowledged the economic recovery has been "frustratingly slow" for millions of unemployed workers and said improvement is occurring at an uneven pace across the sectors. The weak housing market was also cited as a concern.

"Housing plays important role in recovery ... it's been a less vigorous recovery than we like," he said.

Bernanke expects the negative supply chain impact from the Japan earthquake to wane in the second half of the year.

"Our fiscal problems are long term, so the appropriate response should be to enact a long-term plan for fiscal consolidation," he stated.

But to avoid sudden fiscal contraction, the government should quickly implement long term, credible budget cuts, Bernanke said.

Bernanke said that slack in the labor market suggests inflation levels will remain in check. The bulk of inflation this quarter has so far been attributable to high gas prices, rather than factors specific to the U.S. economy.

Once energy prices stabilize, so will price inflation, he said.

David Rodriguez, quantitative strategist at DailyFX, said Bernanke's statement was "surprisingly downbeat."

"Though the Fed Chairman said that economic growth is likely to pick up in the second half of the year, overall dour comments virtually guarantee that U.S. interest rates will remain near record-lows through the foreseeable future," Rodriguez said.

-- Written by Andrea Tse in New York.

>To contact the writer of this article, click here: Andrea Tse.

>To follow the writer on Twitter, go to Andrea Tse.

>To submit a news tip, send an email to:

Copyright 2011 Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs