After a series of dire economic reports, Ben Bernanke has assured America that the Federal Reserve will step in to shore up the economy if sub par growth rates continue. From the AP:
"I believe that additional purchases of longer-term securities should the FOMC choose to undertake them, would be effective in further easing financial conditions,"he said. The FOMC stands for the Federal Open Market Committee, the group of Fed policymakers that makes decisions on interest rates and other steps to aid the economy.
The other two options he laid out are: _Providing more information in the Fed's post-meeting policy statements about how long Fed policymakers would continue to keep rates at record lows. For more than a year, the Fed has been pledging to hold rates at ultra-low levels for an "extended period." • Cutting to zero the interest the Fed pays for banks to keep money parked at the Fed. That rate is now 0.25 percent.
Bernanke's pledge to interfere further with the market will of course not be recognized for what it is, but the business community seems pleased as the Dow Jones industrial average rose 114 points in early trading.