Yesterday, Federal Reserve Chairman Ben Bernanke spoke to students at the University of Michigan on monetary policy.
- Bernanke says fiscal policy has two big issues, long run debt sustainability and fragile economy
- Update: Bernanke says full fiscal cliff threatened new recession and the challenge is to achieve long-term sustainability without hampering recovery
- Update: Bernanke says there are many Mmore fiscal problems ahead, budget sequester and debt ceiling among them; he expects a lot of activity on these issues in the coming months
- Update: Bernanke estimates 1-1.5% fiscal drag in 2013, says there is a lot of work to come on fiscal woes; a long-term approach is needed
- Update: Bernanke says driving down long-term rates stimulates domestic consumption. It is clear that three iterations of QE have driven down rates
- Update: Bernanke says lower mortgage rates have helped the real estate market and that he will continue to assess how effective these tools have been
- Update: Bernanke says the pace of improvement in the economy has been slow; securities purchases major approach to policy with zero-bound rates
- Update: Bernanke says the auto industry and housing in Michigan are rebounding but suffered greatly in the recession
Stay tuned for more coverage of Bernanke's speech.
By Matthew Kanterman