News. Nov. 17 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke’s diagnosis of a weak U.S. economy and labor market signaled that the central bank’s extended period of low borrowing costs may get even longer.
Bernanke said “significant economic challenges remain,” with lending constrained and the jobless rate above 10 percent. Speaking in New York yesterday, he said U.S. asset prices aren’t out of line with underlying values, and central bank policy will ensure that the “dollar is strong.”
My point. The Fed is determined to restore optimism. The only way is to send stocks to new highs. How? By keeping interest rates close to zero percent as long as it takes to get the job done.
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George Dagnino, PhD
Editor, since 1977
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