How the Fed has (and hasn't) fixed the economy

Keeping prices stable is the Fed's other priority. But lately surging gas and commodity prices have sparked fears that the Fed isn't being proactive enough about controlling inflation.

Consumer prices rose 2.7% over the last year, while two of the most common household expenses -- gas and food -- surged even more. Food prices are up 2.9% year-over-year, and gas is up 27.5%

But the Fed strips out these volatile categories and looks at so-called core inflation instead. This measure shows prices have only risen a tame 1.2% since March last year, as falling home prices and stagnant wages have dragged on the entire index.

For that reason, Bernanke continues to insist that inflation isn't a problem yet, and surging food and gas prices may only be temporary.

NEXT: The housing market