June 3rd, 2009
11:49 AM ET
11 years ago

Bernanke: Recovery will be slow

Bernanke said he still anticipates that the economy will start its recovery later this year, but cautioned that 'recovery will only gradually gain momentum.'

Bernanke said he still anticipates that the economy will start its recovery later this year, but cautioned that 'recovery will only gradually gain momentum.'

NEW YORK (CNNMoney.com) - Data suggest the economic contraction may be slowing, but the economy is hardly out of the woods, Federal Reserve Chairman Ben Bernanke told lawmakers on Wednesday.

"A number of factors are likely to continue to weigh on consumer spending, among them the weak labor market, the declines in equity and housing wealth that households have experienced over the past two years, and still-tight credit conditions," Bernanke said.

Bernanke said he still anticipates that the economy will start its recovery later this year, but cautioned that "recovery will only gradually gain momentum and that economic slack will diminish slowly. In particular, businesses are likely to be cautious about hiring and the unemployment rate is likely to rise for a time, even after economic growth resumes."

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Filed under: Ben Bernanke • Economy
soundoff (90 Responses)
  1. Dutch/Bad Newz, VA

    As long as the glimmers of hope continue to show, I agree with Bernanke that the recovery will begin at the end of the year. With people still getting layed off, we definitely are not out of the woods yet.

    June 3, 2009 11:53 am at 11:53 am |
  2. END THE FED!

    Bernake should be shot for what he and his ilk in the Federal Reserve have done to us as a country.

    The Federal Reserve is no more 'Federal' than Federal Express.

    They have no power, and they act outside the government. The Constitution gives congress the power to *COIN* money. With metals that are actually worth value. The Fed just prints a never-ending supply of paper money that's not worth anything. It's going to lead to hyper-inflation, and our country is going to be way, way, way, way, way, way, WAY worse because of it.

    June 3, 2009 11:54 am at 11:54 am |
  3. Gary

    Need a couple things to get done to get our financial system back into good health:

    1. Cut government spending
    2. Cut income taxes on Companies
    3. Cut CEO pay
    4. Cut union wages (frankly we cannot succeed with the unions so powerful, we'll have no manufacturing in this countries if unions demand such high pay for jobs that can be done by a high school drop out).
    5. Everyone must work. No one should get money without working.
    6. Increase the saving rate

    June 3, 2009 11:55 am at 11:55 am |
  4. Dan

    How much does Bernanke get paid to say that "recovery will be slow"?

    Really... how much?

    June 3, 2009 11:58 am at 11:58 am |
  5. Ken

    Sure recovery will be slow. The [R]s have repeatedly crapped in America's pants for the 8 years of Bush and his lemming [R] congress, and long before that with the [R] congress. It will take some time to clean out all the foul-smelling waste they left.

    Is it just me, or has anyone else noticed the similarity of the communications from bin Laden and from lord Limbaugh's RNCC?

    June 3, 2009 11:58 am at 11:58 am |
  6. FreeNLovIt - Romans 1:16 For I am not ashamed (1SPMI) of the gospel, for it is (3SPAI) the power of God for salvation to everyone who believes (PAPMSD), to the Jew first & also to the Greek

    No deuh..... Thanks to Congress and the rest of the media who keeps on focusing on Pelosi and not on the economy

    June 3, 2009 12:02 pm at 12:02 pm |
  7. Mich

    Thank god we have Obama.
    To tax our health care benfits from our employer.
    To run GM, and our Banks, and Fannie and Freddy.
    To under de-value our dollor throught out the world.
    To spend more money every month then any other predient in the last 30 years.

    Don't be suprise if the dollor crashes.

    June 3, 2009 12:02 pm at 12:02 pm |
  8. New Yorker

    Recovery will be slow but we will never recover our freedom if people don't wake up and get this Marxist-Socialist and his regime out of office.

    June 3, 2009 12:04 pm at 12:04 pm |
  9. New Yorker

    Recovery will be slow but we will never recover our freedom if people don't wake up and get this Marxist-Socialist Obama, and his regime, out of office.

    June 3, 2009 12:04 pm at 12:04 pm |
  10. Michael

    Being racially mixed Hispanic and White. I do find that remark to be offensive. There are no absolutes when talking about race. Judge Sotomayor's experience is her's alone and does not reflect the experience of all Latinos, male or female. My grandparents were well educated and hard working when they arrived from Argentina. It is also very stereotypical that Hispanics are constantly being grouped in with impoverished people. I am proud of my heritage, but am more proud of my roots as an American (sans prefix), from a hard working and successful family. So I say to you, all Hispanics are not tough luck stories and dependent on government handouts. It is only here in the states that for some unknown reason, some wish to be considered a part of the "minority" and wear it like some phony merit badge. So her remarks do not get a pass from me because of her tough beginnings.

    June 3, 2009 12:04 pm at 12:04 pm |
  11. Polar Bears Against Palin

    Maybe, we should get New Yorker out of the country.

    June 3, 2009 12:06 pm at 12:06 pm |
  12. ALL I CAN DO IS BLAME SOMEBODY ELSE FOR MY OWN PROBLEMS IN LIFE

    SLOOW RECOVERY, 10 responses just shows the stupidity of the users of CNN.

    June 3, 2009 12:11 pm at 12:11 pm |
  13. Michael M, Phoenix AZ

    Well, DUH! It took at least a decade and a war to get us out of the Great Depression, so now this recovery will take a while also, considering how the former Administration took 8 years to get us where we are today. Don't keep blaming the Democratic Congress for it either...remember the Republicans held the majority up till the 2006 elections and even after 2006 the Dems did not have that great of a majority in both houses to try and undo everything that was done by the Bush people.

    June 3, 2009 12:12 pm at 12:12 pm |
  14. Dawn in Pa

    We as a Country will survive, doing the 70's when we were in a recession, it took almost ten years until jobs were coming back slowly and then another one hit us, but it was not that bad. This is the worst I have seen. I talked to my dad who grew up in the Great Depression, he told me that it is close to what it was like back in the 30's.

    We will get through it, but how long is how long...

    June 3, 2009 12:13 pm at 12:13 pm |
  15. Jon in CA

    Come on folks – LETS GET REAL!

    Obama and Democrats have been spending money FASTER than we can literally print it.

    – The US dollar is crashing (thanks Obama)

    – Inflation is about to crush any semblance of a recovery (thanks Obama)

    – $20 Billion was dumped into GM just months ago to avoid bankrupcy – yet GM still filed bankrupcy and our tax dollars wasted! (thanks Obama)

    REALITY: Under Obama and the democrats – it's going to get a whole lot WORSE before it gets better.

    June 3, 2009 12:13 pm at 12:13 pm |
  16. Dave

    Who can ever believe this guy?? He is gangster #1 and should be public enemy #1. Try him and the bankers for treason. They are out to destroy the economy and the middle class. That is their goal. They only pretend to act concerned for us. The Fed Reserve is not a part of the federal government. They are private and need to be audited.

    June 3, 2009 12:15 pm at 12:15 pm |
  17. Dan

    Ben Bernanke is incompetent and highly unqualified for this job.

    I disagree with him on everything.

    How the heck on earth our Economy is going to recover when:

    1. We are importing more and exporting less. We have a big trade imbalance.
    2. Our dependence on oil is overwhelming. We do not use oil, we waste oil.
    3. Our Manufacturing jobs are all gone.
    4. Our Iron and Steel industries are all gone.
    5. Our textile industry of North Carolina is all gone.
    6. Our Auto industry is all gone.
    7. We have everything made in China.
    8. We have outsourced to India because of cheap labor.
    9. We are still spending billions on 2 wars. Wars are draining our Economy.
    10.We import nurses from Philippines.
    11.Our Construction industry is full of illegal immigrants.

    NOW I SAY, until and unless these above factors are fixed. Our Economy is going to get even Worst. Take my these words for sure.

    June 3, 2009 12:19 pm at 12:19 pm |
  18. munchmom

    DUH again! And we have Obama to thank for this–spending more and more when we have less and less, and then spending money needlessly on a trip to NYC with his wife for a "date". Wish I could afford a date like that. When will he start realizing that the "Main Street" he talked so much about during the campaign is really suffering. I have had to buy groceries on a charge card, something I thought I would NEVER have to do (and grossly in debt from two job losses in a row!). And gas goes up, cars get more expensive and less efficient, people are continuing to lose jobs (car dealerships, GM plants, auto parts makers, etc.) because of these bailouts...where will it end??? Get over yourself, Obama, and get back to work on America's problems instead of falling all over yourself apologizing for what you think we did overseas!

    June 3, 2009 12:21 pm at 12:21 pm |
  19. Simpliticus

    It seems to me that this country did crash economically speaking and that we are experiencing similar effects to the Great Depression. What might be different is the manner in which we got here. In the Great Depression, the stock market collapsed because the country ran out of credit. In this period, the banks ran out of credit which stymied our country but we arrive to the similar outcome! Lack of credit forestalls the country to get out of this economic morass that the housing bubble put us into along with the misguided policies of an unregulated Bush administration. The effects are however the same!

    June 3, 2009 12:22 pm at 12:22 pm |
  20. barking republican ankle biters

    He and Paulson caused everything that is now happening and they did it on purpose.This guy is so shady and crooked,we should just call him tree.Nothing is happening today,that wasnt planned out years ago.Both parties are in on the crimes.

    June 3, 2009 12:23 pm at 12:23 pm |
  21. Fair is Fair

    Michael M, Phoenix AZ June 3rd, 2009 12:12 pm ET

    Well, DUH! It took at least a decade and a war to get us out of the Great Depression, so now this recovery will take a while also, considering how the former Administration took 8 years to get us where we are today.
    ______________________________

    Michael, an objective (meaning non-partisan) look at the history of the great depression will show that FDR's "new deal" (beaucoup spending) actually worsened and lengthened the depression.

    You are correct about the war, though. Let's hope it doesn't come to that again.

    June 3, 2009 12:23 pm at 12:23 pm |
  22. Randolph Carter

    What do the S&L scandal, the dot com bust and our current problems have in common? The period of "prosperity" preceding them was based on futures, derivatives and other imaginary commodities. Nothing of real value was produced. The current recession is just a return to a more realistic notion of what has value and what does not. Instead of investing in imaginary commodities, we should be investing in things that actually have value like education, healthcare, infrastructure, technology, you know, stuff that benefits us all and not just the wealthy. But that would be socialism, right?

    June 3, 2009 12:24 pm at 12:24 pm |
  23. Teleprompter of the U.S.A.

    Jon in CA is right – our dollar is crashing.

    Geithner tells the Chicomms that our debt they own is safe and they laughed. The reason they laughed is because we put bonds up for sale and then buy that debt with money we just printed. The Chicomms realize that is bad mojo and very inflationary.

    That's Obama's legacy. He is going to tank this economy doing dumb crap like that.

    June 3, 2009 12:26 pm at 12:26 pm |
  24. I give up

    wait until they start monetizing the debt, by printing money. the result is inflation that will make us all poorer and the creation of a new currency called the greenpeso or ruble.

    June 3, 2009 12:26 pm at 12:26 pm |
  25. Kelby In Houston, TX

    @ Jon in CA:
    REALITY: Under Obama and the democrats – it's going to get a whole lot WORSE before it gets better.

    *****************
    This is true. It's always darkest before the dawn, but know that the sun will rise again, KNOW that there is hope for the future. There is hope for all of us, if you believe.
    This article states that economic recovery is eminent. And you reject that idea. Why? Don't you want our economy to recover? Shouldn't you be glad that soon we will be doing better? Don't you want America to succeed?

    June 3, 2009 12:26 pm at 12:26 pm |
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