video transcript

PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL On day two of Federal Reserve Chairman Ben Bernanke's semi-annual testimony before lawmakers, there were questions about housing, jobs, and new Wall Street regulations. And when asked about potential risks to the economic recovery, Bernanke pointed to a very recent surge in energy costs. SOUNDBITE: FEDERAL RESERVE CHAIRMAN BEN BERNANKE (ENGLISH) SAYING: "To some extent a little bit of the movement in commodity prices is essentially inevitable because if the economy is growing and the world economy is growing, the demand for commodities goes up and that is going to create some tendency toward higher commodity prices. But when you have shocks to commodity prices arising from geopolitical events and the like, those are unambiguously negative, and they are bad for both households and for the broader economy." And housing remains at the top of his worry list. SOUNDBITE: FEDERAL RESERVE CHAIRMAN BEN BERNANKE (ENGLISH) SAYING: "Housing I think, remains a very difficult area. We are hoping for price stabilization. We think once people have gotten a sense that the housing markets have stabilized, they will be more willing to buy and the banks will be more willing to lend. But right now there is still uncertainty about where the housing market is going, which I think is troubling." Bernanke was also asked about budget deficits and debt reduction by Republican Senator Jim DeMint. SOUNDBITE: SENATOR JIM DEMINT, REPUBLICAN, SOUTH CAROLINA (ENGLISH) SAYING: "Would a plan that balanced our federal budget with a 10-year window, would that be what you considered a reasonable transition towards good fiscal policy?" SOUNDBITE: FEDERAL RESERVE CHAIRMAN BEN BERNANKE (ENGLISH) SAYING: "I would aim for the next 10 to 15 years for eliminating the so-called primary deficit, that is everything except interest payments, because once you eliminate the primary deficit so that current spending incurred and revenues are equal, that means that the ratios of your debt to your GDP will stabilize. Then as you go beyond that you start to bring your debt-to-GDP ratio down. Many of the things that can be problems are kicking in after 10 years, so I hope Congress will take a longer-term horizon than that." Bernanke will provide further clues on monetary policy after the Fed meets on March 13th. Conway Gittens, Reuters