Ben Bernanke Seems Helpless

The lead article in today’s New York Times, “Fed Ready to Dig Deeper to Aid Growth, Chief Says,” doesn’t exactly inspire confidence about the future of the economy. Ben Bernanke, head of the Fed, signaled that he was prepared to buy up more government debt to bolster the anemic economic recovery we have been seeing.

His gesture about the possibility of future action, in lieu of any concrete steps now, seems to be as anemic a response as the economy. We saw a disastrous housing report for July, with double the drop in the market predicted by the experts, a revising of economic growth figures from 2.4 percent to 1.6 percent, and still no indication of any alleviation of unemployment figures, the main impediment to a robust recovery. Consumers drive two-thirds of the economy and without more employment, they have a lot less money to spend.

Of course, Mr. Bernanke can’t cure the economy on his own; that would take coordinated action by the President and Congress, and Republican recalcitrance to any form of action seems to preclude that possibility.

Most experts seems to predict continued slow growth; the alarmist predictions of a double-dip recession by the right wing are just that, alarmist. And most investors know that the pace of this recovery is about average or even slightly above average compared to previouis recessions.