Bernanke holds town hall meeting

WASHINGTON Thu Nov 10, 2011 1:47pm EST

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WASHINGTON (Reuters) - The following are highlights of Federal Reserve Chairman Ben Bernanke's town hall meeting on Thursday with soldiers and their families at Fort Bliss, Texas.

BERNANKE ON ROLE OF THE FED

"I'm not a believer in the Old Testament theory of business cycles. I think that if we can help people, we need to help people and that's why the Federal Reserve is, again, trying to do what we can to get the economy back on track. And we have made some progress, though we are still far from where we would like to be."

BERNANKE ON U.S. NOT INSULATED FROM EUROPE'S CRISIS

"The world's financial markets are highly interconnected so if there were to be a substantial increase in financial stress in Europe -- say because of an unexpected and disorderly default by one of the countries -- that would create a freezing-up of credit, a withdrawal of short-term funding, a decline in stock prices, all those negative things ... not just in Europe but around the world. As we saw a few years ago if the financial system freezes up it has very serious implications for the economy and so it's very much in our interests, in the interests of the emerging world as well as the Europeans, to find a solution to that situation. It is not something that we would be insulated from and although the Fed would obviously do all that we could to maintain stability and to keep monetary policy as easy as necessary to try to minimize the damage, I don't think we would be able to escape the consequences of a blow-up in Europe."

BERNANKE ON S&P'S DOWNGRADING OF U.S. DEBT

"I think in some ways it is a secondary issue. After all, after S&P downgraded U.S. Treasury debt, the interest rates we pay on our Treasury debt actually went down rather than up. So in other words, the downgrade didn't scare off any investors in terms of being willing to buy U.S. Treasuries. In fact, U.S. Treasuries remain a safe haven and whenever there is increased volatility in the markets because of some concern about Europe or something else that is causing worry, what you see is that people come in and buy Treasuries because they view that as among the very safest and most liquid investments in the world. So, in that respect the downgrade, or any potential downgrade hasn't really done, at this point anyway, any significant damage to the United States economy or to our fiscal situation. But the underlying point is that we are not on a sustainable fiscal path."

BERNANKE ON DEBT BURDENS

"It is certainly true that debt is a big part of our problem... Households trying to improve their balance sheets, trying to pay down their debt (and) trying to reduce their credit card balances are part of the reason why consumer spending has been relatively weak. And that has been a factor slowing the recovery."

BERNANKE ON EU LEADERS EFFORTS TO STEM CRISIS

"It's really important that they implement those steps, that they execute them forcefully and that they take whatever actions are necessary to stop the European crisis."

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Comments (6)
jeffersonite wrote:
People need to realize what the Federal Reserve is all about.
Here’s some basics: It’s a PRIVATE bank, with FOREIGN investors. It exists to make PROFIT. It was created SECRETLY on an island in Georgia and passed into law Christmas Eve 1913. They create money out of THIN AIR, and loan it to the government. They create DEBT. Their mission is to create DEBT. They have bribed politicians, corporations, and the media over the decades to hide their true objectives and to continue to prosper. Politicians take the money, and BUY us things with it. And we keep electing these crooks. Most of the Democrats, and more than half of the Republicans are now in on this ponzi scheme.
The Fed has enslaved us.

Nov 10, 2011 2:49pm EST  --  Report as abuse
A stroke of sheer genius…print and trash the USD into oblivion so no one in the audience can afford to buy the rotten fruit with which to bombard him.

Nov 10, 2011 3:07pm EST  --  Report as abuse
rebelnewsman wrote:
Two questions should be asked of Ben. 1 is the Federal Reserve a Federal Institution or is it Private? 2 Why would a country that is bound by its Constitution to have the congress coin and lend money have a privately owned bank loan out money and have them collect the interest via taxation. What we should ask ourselves is “Why are we still buying this lie?”

Nov 10, 2011 3:14pm EST  --  Report as abuse
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