"The Committee will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in the context of price stability," Bernanke said.
Stressing that higher inflation earlier in the year had not become ingrained in the economy, Bernanke argued price pressures will remain subdued for the foreseeable future.
“Bernanke is not saying anything that we haven’t heard recently,” notes David Ader at CRT Capital, but the idea of being “prepared to take further action can only mean QE3,” which means bulking up the Fed’s balance sheet...
Pavlov dogs are responding accordingly with the NASDAQ now in the green. They never change their stripes. (let's see how long of a lift this one gets, versus yesterday's ISM Mfg data)
It is amazing how drug dependent we now are. If you look at the time frames the past 2+ years there has been no QE, the market has been in almost constant freefall. When QE is on, we celebrate like its 1999.
In an unrelated note - he did not apologize for being completely wrong with his 'transitory' comments this spring, as it related to the slowdown. He also did not say oops on how badly off the Fed economic forecasts have been (yet again). Because he is accountable to no one.