Bernanke warns Congress
IHS Global on Bernanke’s talk-talk:
Bernanke wanted to send the message that Congress needs to prepare its own “exit strategy” from unsustainable budget deficits. His formal remarks made no mention of a possible second stimulus package (under questioning he said that the idea was “premature”), and he said that policymakers should begin planning “now” to restore fiscal balance. He didn’t offer prescriptions on what to do (whether to raise taxes or cut spending), but said that postponing choices would only make them more difficult. He said that agreement on a sustainable fiscal path could lower long-term interest rates and boost confidence – the implication being that lack of agreement would do the opposite.