EconomicCrisis.US

Following are remarks by US Federal Reserve chairman Ben S Bernanke at the Federal Reserve Bank of Boston 56th Economic Conference.

The financial crisis of 2008 and 2009, together with the associated deep recession, was a historic event — historic in the sense that its severity and economic consequences were enormous, but also in the sense that, as the papers at this conference document, the crisis seems certain to have profound and long-lasting effects on our economy, our society and our politics.
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Panic is back in the financial markets. In the United States, the long-awaited recovery is still missing and the latest economic data are very worrying.

In the labor market, unemployment is still above the ceiling of 9% of the workforce. Last week, the stock market, including the Dow Jones, went through a sharp decline following the publication of statistics on industrial activity in the country.

Major banks have already revised their growth estimates downward. For the fourth quarter of 2011, JP Morgan is now evaluating the growth of US GDP at 1%, versus 2.5% previously. Worse still, in the first quarter of 2012, GDP should grow by only 0.5% according to their estimates.
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The U.S. trade deficit unexpectedly widened in December as imports rose faster than exports, gains that signaled a pickup in global economic growth.

The gap grew to $40.2 billion, the biggest in a year, from $36.4 billion in November, according to Commerce Department data released today in Washington. Imports increased 4.8 percent and exports climbed 3.3 percent to the highest level since October 2008.

Faster growth in emerging countries and a drop in the dollar’s value that is making American goods more competitive may keep propelling gains in sales overseas and spur U.S. manufacturing. Efforts to rebuild inventories will probably also draw in goods from abroad, giving world trade a lift.
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Reporting from Washington – Federal Reserve Chairman Ben S. Bernanke has been praised by President Obama and hailed by most mainstream economists for bold policies that played a critical role in pulling the U.S. economy back from the brink of disaster.

The Fed chief even won a celebrity accolade Wednesday when Time magazine named him Person of the Year.

But instead of basking in glory, the 56-year-old professorial Fed chairman is fighting for his job — and for the survival of policies at the heart of efforts by the central bank and the Obama administration to keep the nation’s fragile recovery on track.
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