Bernanke: Need more time to recoup job losses

By Jennifer Liberto, senior writer


WASHINGTON (CNNMoney.com) -- Fed chairman Ben Bernanke said that private sector demand will be "sufficient" to spur a moderate economic recovery in coming months, but he added that more time is needed to recover job losses.

"A recovery in economic activity appears to have begun in the second half of last year," Bernanke told the Joint Economic Committee.

Bernanke's speech was mostly upbeat, noting all the different areas where the economy has picked up. He pointed to higher GDP rates, increasing auto sales and a strengthening financial system as catalysts for the Federal Reserve to wind down programs that were propping up those sectors.

"Going forward, consumer spending should be aided by a gradual pickup in jobs and earnings, the recovery in household wealth from recent lows, and some improvement in credit availability," Bernanke said.

He cautioned that the unemployment rate and the housing market remain areas of concern.

"I am particularly concerned about the fact that, in March, 44% of the unemployed had been without a job for six months or more," Bernanke said. "Long periods without work erode individuals' skills and hurt future employment prospects. Younger workers may be particularly adversely affected if a weak labor market prevents them from finding a first job or from gaining important work experience."

Bernanke also spoke about the need for policymakers to start tackling the growing federal deficit, to maintain "the confidence of the public and financial markets."

Sen. Sam Brownback, R-Kansas, asked Bernanke about whether the nation could face problems like Greece or Ireland, with countries doubting the U.S.'s ability to control its debt.

Bernanke stressed that the United States has a more "diversified," economy, but acknowledged that, "at some point, the markets will make a judgment about our political will to achieve longer term stability." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 16,912.11 -70.48 -0.42%
Nasdaq 4,442.70 -2.21 -0.05%
S&P 500 1,969.95 0.00 0.00%
Treasuries 2.46 0.00 0.00%
Data as of 12:32am ET
Company Price Change % Change
Frontier Communicati... 6.79 0.85 14.31%
Windstream Holdings ... 11.83 1.30 12.35%
AT&T Inc 36.59 0.94 2.64%
CenturyLink Inc 39.90 2.19 5.81%
Bank of America Corp... 15.34 -0.16 -1.03%
Data as of Jul 29

Sections

McDonald's may be liable for worker lawsuits, not just franchisees, in a government ruling that could change the fast-food business. More

Amgen is the latest to continue corporate America's cost cutting strategy, even as the economy is supposedly on the mend More

Bunch o Balloons allows multiple water balloons to be filled at once. Parents are loving it -- to the tune of $645,000. More

Steve Mason, a pastor from California, inherited more than $100,000 in student loan debt when his 27-year-old daughter died suddenly in 2009. With interest and late penalties, the debt has since ballooned to $200,000. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.