Ben Bernanke announced his next steps during the central banks governors meeting,hold in Jackson Hole (Wisconsin),just the day when the United States revised the GDP growth during the second quarter, than has been lower than the expected.

The GDP of the United States grew now by 1,6%, in front of the 2,4% considered in a beginning. However,the reduction was lower than the expected by analysts, that foreasted a GDP growth by 1,4% .

Ben Bernanke admitted that the recovery is “far to be complete” and the return to growth is “less vigorous than we expected “. According the Federal Reserve, this bad behavior is due to the weak real state market, affected by the fact that the household demand is growing with less strenght than the expected. Last week we could know that July household sales in The United States were reduced by 12,4% respect the month of June.

However, due to a lower recovery speed, the president of the Federal Reserve discarded a new entrance in the recession by the United States. “the conditions for the recovery of 2011 continue standing” and the Federal Reserve “has tools to give additional stimulus”.

The Federal reserve can not alone

However, Ben Bernanke asked for help from governments. “the steady growth will require effective and appropiate actions from the governments and the private industry. Central bankers , alone, can’t solve all economic problems of the world”, warned Ben Bernanke.

Ben Bernanke believes that there isn’t “deflation risk”, but says that the Federal Reserve can fight it.

In case of necessity of further stimulus, the Federal Reserve plans to implement a expansive monetary policy, mainly buying long therm public bonds. However, these operations must be analyzed well to compare expected profits with the potential risks and costs.

Ben Bernanke anticipated that the Federal Reserve can also lightly modify his communications about interest rates, pointing that money price will continue low not just by a long period “We can say that prices will we lower more time than what markets are discounting”, pointed.

Ben Bernanke discarded that the United States were going to register deflation (general fall in prices), possibility that concerns investors. Sun Won Sohn, professor of the California State University, said that we can’t doubt about the existence of unrest. Ben Bernanke doesn’t see it so fair. “there aren’t risks” but, if some evidence was produced,the Fed would fight it and offer a “strong resistance”.

For the analysts of Goldman Sachs, the words of Ben Bernanke allow to see the “measures”that could adopt the Federal Reserve, although his general tone has been to watch and stay for the evolution of the economy.

Para los analistas de Goldman Sachs, las palabras de Bernanke permiten ver las “directrices” que puede adoptar la Fed, pese a que su tono general haya sido el de “ver y esperar” a ver cómo evoluciona la economía.

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The people against Ben Bernanke, some afraid of his reelection and some disagree with what the Fed done with the financial crisis, moved against him, enlarging the list of negative votes already revealed.

Democrat senators Barbara Boxer (California) and Russ Feingold (Wisconsin) said that will be against the reelection of Ben Bernanke, that should be before the January 31st.

Ben Bernanke needs 60 votes to ensure his reelection, due to the blocking system of the chamber. Donald Kohn, vicepresident of the Federal Reserve, would be the interim chief of the bank is reelection of of Ben Bernanke is postponed.

Other names that circulated as alternatives for the presidency of the Federal Reserve, include Kohn himself, Lawrence Summers, the economic assistant of the president, and Alan Blinder, the economist of the Princeton University.

The assessors of the White House and the Treasure, Rely on that Ben Bernanke will be confirmed by the senate, when will be accomplished five months since the president of the United States announced his nomination.

Before the vote of Harry Reid, democrat leader of the Senate, seemed to be doubting, but said that ‘”Although I will vote for, my support isn’t unconditional”

Some economists warned that rejecting Ben Bernanke could be seen as a threat to the independence of the Federal Reserve. So and the shares falled by 2%.

A “No” to Ben Bernanke could be seen by the markets as a sign of uncertainty. Chris Dodd, the president of the Banking comittee of the Senate, said that a ”No” to Ben Bernanke for answer t would leave the economy in a sharp fall.

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The FED left yesterday the intervals of the interest rate low, between 0% and 0.25%, this level has been remaining the same this last year. Furthermore, stated that will leave interest rates exceptionally low during a low period of time.

Ben Bernanke is showing more optimism about the economic situation, mainly about the labor market. The information received from the Federal Open Market committee (FOMC) since the meeting in November suggest that the economic activity is improving and the destruction in the labor market has ended, the unemployment rate surprisingly decreased in November from 10.2% to 10%.

Ben Bernanke is being careful about it

However, Ben Bernanke wasn’t specially optimistic and showed caution, when adding that consumption growth is moderate although will continue being affected by unemployment , the credit restrictions and lower income growth. At the same time, Ben Bernanke said that companies are not likely to increase payrolls.

Other thing mentioned by Ben Bernanke, is the retreat of the emergency measures to help banks, the Fed wanted to remark that especial needs of liquidity will expire on February 1st 2010. This is any new date, but Ben Bernankeis telling that will now enlarge them when reiterating it.

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The president of the Federal Reserve, reiterated that although the economy has returned to the growth, ” the interest rates will continue low during a long period of time”.

In spit of the return to the positive data of the US GDP, the Unemployment is continuing to rise unstoppable, because the economic growth isn’t intense enough to create new jobs. Ben Bernanke remarked that there is still a problem with credit that ”together with the growing unemployment and a weak economy, will postpone the economic recovery”

Ben Bernanke is seeing big challenges for the incoming year, but signaled that ” some notable changes in the economic conditions, will turn the landscape of the monetary policy”. For the next year, Ben Bernanke sees ”a moderate growth, that will not be enough to reduce unemployment”, The current policy of the Federal reserve will be kept during some further months.

”We are watching the dollar from very close”

at the Same time, Ben Bernanke recognized that is worried with the dollar , He also stated that the Federal Reserve is following the value changes of the dollar and will design a policy to ”avoid risks” with the objective of promote employment and stability in prices”.

Ben Bernanke considers that the devaluation of the dollar as a mirror of the increase in prices of raw materials due to the improvement of the global economy.

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