Bernanke's Next Challenge: Undoing His Own Work

Fed says inflation on target, but unemployment high, growth sluggish

(NEWSER) - Don't get too excited about that pending economic rebound . The Federal Reserve's announcement it will keep interest rates super-low into 2014 is a key sign that the US economy is years away from truly recovering, reports the New York Times . Yes, the economy has picked up "moderately," said the Fed in a statement, but jobs are still scarce and growth is expected to be sluggish for the foreseeable future—2.7% in 2012, 3.2% in 2013, and perhaps as high as 4% in 2014. “What did we learn today? Things are bad, and they’re not improving at the rate that they want them to improve,” said the chief US economist at HSBC. More»

Nope, says spokesman: event reports, pics are online

(NEWSER) - At the nadir of the economic crisis, the Obama White House held a lavish Alice in Wonderland-themed Halloween costume party, organized by Johnny Depp and Tim Burton and full of Star Wars character. But with unemployment at 10%, the Tea Party at its apex, and the economic downturn still rocking the country, officials feared the 2009 party would look terribly decadent, so kept it a secret, reports the New York Post . “White House officials were so nervous about how a splashy, Hollywood-esque party would look to jobless Americans—or their representatives in Congress, who would soon vote on health care—that the event was not discussed publicly, and Burton’s and Depp’s contributions went unacknowledged,” alleges Jodi Kantor in her new book, The Obamas . More»

Bill Daley says Congress won't let Obama be a chief executive

(NEWSER) - Roger Simon of Politico has an entertaining interview with White House chief of staff Bill Daley. Some highlights:

• How it's going: “It’s been a brutal three years. It’s been a very, very difficult three years, an incredible three years. And we are doing all this under the overhang of the worst financial crisis since the Great Depression. F--k! It wasn’t like all this was happening in good times."
• On 'we can't wait': "Both Democrats and Republicans have really made it very difficult for the president to be anything like a chief executive. This has led to a kind of frustration," and to the president's push for the executive branch to do as much as it can without Congress.

It's the most a chairman has faced in 19 years

(NEWSER) - Ben Bernanke's Tuesday announcement that the Fed is prepared to keep short-term interest rates close to zero for at least two more years is facing internal revolt from the Federal Open Market Committee, the 12-member committee of Fed presidents and governors that sets monetary policy, reports the Wall Street Journal . Bernanke is facing three dissenting opinions for the first time in his five-and-a-half-year tenure—the most dissents issued by FOMC in 19 years. More»

Fed chief, president expect recovery will strengthen

(NEWSER) - Ben Bernanke isn’t worried about a double-dip recession, despite an economy he acknowledged as unexpectedly troubled this year, reports MarketWatch . “I expect hiring to pick up from last month’s pace as growth strengthens in the second half of the year,” the Fed chairman told a meeting of international bankers in Atlanta. He said that high commodity prices weren’t the Fed’s fault, and that Japan’s earthquake was the cause of poor economic numbers since April. Its effects will wear off in the next few months, he said, helped by the possibility of lower gas prices. More»