From the Q&A portion only, with extraneous words (the date, the time, Bernanke’s name, page number on the transcript, etc., all removed).

(Click through for larger.)

It was Greg Ip who questioned Bernanke about the part of the FOMC statement that referenced the slowdown “in part” being caused by certain temporary factors.  Here’s that exchange:

Greg Ip: Mr. Chairman, the Committee lowered not just this year’s central tendency forecast but also 2012. And, yet, the statement of the Committee attributes most of the revision forecast to temporary factors. So I was wondering if you could explain what seems to be persisting in terms of holding the recovery back. I did see the statement says in part to factors that are likely to be temporary. Are there more permanent factors that are producing a worse outlook than three months ago?

Chairman Bernanke: Well, as you — as you point out, what we say is that the temporary factors are in part the reason for the slowdown. In other words, part of the slowdown is temporary, and part of it may be longer lasting. We do believe that growth is going to pick up going into 2012 but at a somewhat slower pace from — than we had anticipated in April. We don’t have a precise read on why this slower pace of growth is persisting.

One way to think about it is that maybe some of the headwinds that have been concerning us like, you know, weakness in the financial sector, problems in the housing sector, balance sheet and deleveraging issues, some of these headwinds may be stronger and more persistent than we thought. And I think it’s an appropriate balance to attribute the slowdown partly to these identifiable temporary factors but to acknowledge a possibility that some of the slowdown is due to factors which are longer lived and which will be still operative by next year. You note that, in 2013, we have growth at about the same rate that we anticipated in April.

Mr. Ip recently pointed out that the Fed has done little but repeatedly downgrade its economic forecasts, doing so time and again.

Adding, in response to BR’s inquiry:  “Think” was uttered almost exclusively by Bernanke, and the overwhelming context was “I think…”.

Category: Federal Reserve

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

11 Responses to “Thoughts From Bernanke’s Presser”

  1. 873450 says:

    Still, he inherited a mess that was 20+ years in the making and his rhetoric is preferable to windbag, geezer Greenspan’s excessively long, drawn out, “That’s an interesting question and something I’ve been studying …,” meandering pontifications spouting on about everything while explaining nothing.

  2. JimRino says:

    There’s No Recession at the Jersey Shore.
    And, it’s crowded.
    Talked with the owner of a motel, they are booked, and Reservations are up from last year.

  3. AHodge says:

    thank you mr chairman
    these financial headwinds are sure as opaque as the banks balance sheets
    but we will just have to wait for the (wont buy securitized crap ) deleveraging to end..
    are you sure the banks are happy enough? i hear they have regulation issues with you?

  4. AHodge says:

    maybe he can explain how blah blah about capital requirements
    like he knows what bank capital is
    stops securitizing (that needs no capital once sold?)

  5. In colloquial English, “I think” is often used as shorthand for “I have no idea.”

  6. Sunny129 says:

    Greenspan brought housing bubble after keeping rate at 1.0% too long.

    But Barnake is doing the same thing with 0.25% ZRP but NOT even a single reporter during press conference asked’ Why are you repeating the same mistake?” NONE!

    Japan’s rate 0.1% and still facing deflation after two decades!

    Ben also stated re deficit/debt reduction that it should be a LONG TERM project but not now! Why didn’t any one of those BOZO reporters ask ‘ Debt ceiling has been raised 74 times in the past and how long one should wait? NONE!

    They ALL are gutless and absolutely have NO CREDIBILITY left with any one with functioning brain!

    The shamelessness of ACCESS Journalism!

  7. JimRino says:

    He’s following the Taylor Rule, the real rule, which at this point does not call for a rate hike.
    Of course, you can screw with the Taylor Rule and make assumption adjustments, and that’s what the “right” is doing by pretending now is the time to raise rates. Now is Not the Time to Raise Rates. The Republican Governors created DEEPER Recessions in their States by going crazy with Budget Cuts during a Recession, which has Never Produced Growth.

    Shock Example of Discovering the OBVIOUS.
    States that Cut the Most -> Lost the MOST JOBS.

    This is why I stopped believing the Republican Bull, there is NO Evidence Republican Policy Works.
    I’d say 9 times out of 10 Republican Policy Decisions are Now Bad for America.

    Republicans fund fake Economic Analysis, and then FORGET they paid for garbage, and actually start Believing the fake garbage they’ve funded!

  8. rktbrkr says:

    Chance the Gardener for Fed head!
    President “Bobby”: Mr. Gardner, do you agree with Ben, or do you think that we can stimulate growth through temporary incentives?
    [Long pause]
    Chance the Gardener: As long as the roots are not severed, all is well. And all will be well in the garden.
    President “Bobby”: In the garden.
    Chance the Gardener: Yes. In the garden, growth has it seasons. First comes spring and summer, but then we have fall and winter. And then we get spring and summer again.
    President “Bobby”: Spring and summer.
    Chance the Gardener: Yes.
    President “Bobby”: Then fall and winter.
    Chance the Gardener: Yes.
    Benjamin Rand: I think what our insightful young friend is saying is that we welcome the inevitable seasons of nature, but we’re upset by the seasons of our economy.
    Chance the Gardener: Yes! There will be growth in the spring!
    Benjamin Rand: Hmm!
    Chance the Gardener: Hmm!
    President “Bobby”: Hm. Well, Mr. Gardner, I must admit that is one of the most refreshing and optimistic statements I’ve heard in a very, very long time.
    [Benjamin Rand applauds]
    President “Bobby”: I admire your good, solid sense. That’s precisely what we lack on Capitol Hill.

  9. rktbrkr says:

    Maybe Ben Shalom was just channeling Rumsfeld’s known unknowns, unknown unknowns thoughts in his reply

  10. My Recession Indicator is in basic agreement with the Fed’s analysis but certainly does not share their inferred 3.75% enthusiasm for 2011H2.

    After last week’s data releases, TRI is projecting a 1.8% GDP trough in November … rising to 2.3% by its 2013Q2 horizon.

    TRI chart:

  11. Senior Programmer says:

    Bernanke: A stooge appointed by a stooge, reappointed by a stooge, and intently listened to by people who probably voted for a stooge.