Amazing that Bernanke suddenly utters coherent and truthful economic analysis when under oath and attempting to convince the Senate of his need for additional printing (quantitative easing) in the near future.
Federal Reserve Chairman Ben S. Bernanke said the 8.3 percent rate of unemployment in January understates weakness in the U.S. labor market.
“It is very important to look not just at the unemployment rate, which reflects only people who are actively seeking work,” Bernanke said today in response to questions at a hearing before the Senate Budget Committee in Washington. “There are also a lot of people who are either out of the labor force because they don’t think they can find work” or in part-time jobs.
The jobless rate unexpectedly fell to 8.3 percent in January, a government report showed on Feb. 3. Bernanke’s remarks indicate that his view that the labor market is a “long way” from returning to normal hasn’t changed since he used the same phrase when he testified to the House Budget Committee on Feb. 2.
“The 8.3 percent no doubt understates the weakness of the labor market in some broad sense,” Bernanke said today, while noting that some job indicators are improving.