The Wall Street Journal - WASHINGTON -- U.S. Federal Reserve Chairman Ben Bernanke on Tuesday appeared to back the White House's efforts to stimulate the economy, saying aggressive action is needed now to avoid an economic calamity.
"By supporting public and private spending, the fiscal package should provide a boost to demand and production over the next two years as well as mitigate the overall loss of employment and income that would otherwise occur," Mr. Bernanke said in prepared testimony to the Senate Budget Committee. (Read the remarks.)
President Barack Obama recently signed a $787 billion stimulus mixing infrastructure spending, aid to states and tax cuts. Approval came almost entirely without Republican support in Congress, making Mr. Bernanke's supportive comments noteworthy since he served for a time as President George W. Bush's top economist in 2005 before becoming Fed chairman.
Mr. Bernanke's latest comments come amid signs that the recession which began in December 2007 is deepening. Gross domestic product plunged at a 6.2% rate last quarter, the Commerce Department said last week, the steepest slide since the early 1980s. And the recent bloodbath on Wall Street brought the Dow Jones Industrial Average to levels not seen in a dozen years on Monday.http://online.wsj.com/article/SB123609244895319071.html#mod=testMod
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