WASHINGTON (MNI) – The following is an excerpt from Federal Reserve
Chairman Ben Bernanke’s semi-annual hearing Q&A session Tuesday for the
Senate Banking Committee:
When asked about the cost of another round of Quantitative Easing:
BERNANKE: On savings, we understand that the low interest rates are
a hardship for many people. The reason interest rates are low is that we
are trying to promote a recovery in the economy. People who hold fixed
income types of securities like CDs or Treasury bonds, but they also
hold stocks or corporate bond or small businesses or other types of
assets which depend on the strength of the economy, and raising interest
rates might help some folks but if it caused the economy to weaken
considerably it would be bad for investors broadly speaking. So what we
are trying to do, of course as our mandate suggests is to strengthen the
economy which in turn should make America a more attractive place to
invest and provide higher returns for everyone investing in the United
States.
On the dollar and inflation, I appreciate your concern and thats
obviously one of the things we pay very close attention to. We have not
seen inflation yet though, and the dollar has been recently a good bit
stronger, and we are comfortable that we have the tools to unwind these
policies in a way that will not threaten inflation. We take both sides
of the mandate very seriously, and as we are looking to try and help
reduce unemployment we also want to be confident that we maintain price
stability in the United States and thus far we have been successful in
doing that.
** MNI Washington Bureau: (202) 371-2121 **
[TOPICS: M$U$$$,MMUFE$,MGU$$$,MFU$$$]
