Bernanke: Economy Is Inching Back

Federal Reserve Chairman Ben Bernanke said Thursday that the economy is inching back, and touted his agency’s recent decision to purchase Treasury securities on the open market.

Bernanke said the outcome of this decision mirrors the results of a successful policy enacted after the financial crisis.

“[That] lends credence to the view that these actions had the expected effects on financial markets and are thereby providing significant support to job creation and the economy,” Bernanke said during a speech at the National Press Club in Washington, DC.

Bernanke said that job creation is expanding the same way the economy is — slowly.  The 100,000 jobs created per month in 2010 was almost not enough to accommodate the natural growth of the employment pool of recent graduates and others entering the job market. It will take several years, Bernanke, said, before the nation’s 9.4% unemployment rate reaches natural levels.

“Until we see a sustained period of stronger job creation we cannot consider the recovery to be truly established,” he said.

The Fed Chairman also backed President Obama’s call for added infrastructure and technology spending, and disagreed with Rep. Ron Paul’s (R-Texas) belief that the Fed should undergo annual audits. Bernanke said the U.S. needs to have a strong, independent central bank.