Giving speeches on the economy is apparently so popular an activity that Ben Bernanke had to get in two in fairly rapid succession. His latest one was rather curious in a way:
Ben S. Bernanke, the Federal Reserve chairman, offered a new twist on a familiar subject Thursday, revisiting the question of why growth continues to fall short of hopes and expectations.
Mr. Bernanke, speaking at a luncheon in Minneapolis, offered the standard explanations, including the absence of home construction and the deep and lingering pain inflicted by financial crises. He warned again that reductions in government spending amount to reductions in short-term growth.
Then he said something new: Consumers are depressed beyond reason or expectation.
Oh, sure, there are reasons to be depressed, and the Fed chairman rattled them off: “The persistently high level of unemployment, slow gains in wages for those who remain employed, falling house prices, and debt burdens that remain high.”
However, Mr. Bernanke continued, “Even taking into account the many financial pressures that they face, households seem exceptionally cautious.” Consumers, in other words, are behaving as if the economy is even worse than it actually is. (emphasis mine)
People have been slammed by yet another bubble bursting, and harder than in recent history due to the Financialization of Everything. Even people with jobs are in poverty at rates big enough for media attention. Most real gains have stayed at the top for a long time. Oh, yeah, and while unemployment stays high and people struggle with all that debt there’s a new report about record corporate profits seemingly every other day. A few well-connected people, with the help of the state, are doing just fine.
Bitter? Depressed? Gee, you think?
I’ve got an idea for job creation of my own, by the way: hire people to fill Bernanke’s office with cement.