Fed Chair Calls for Cuts to Record Deficit

(AP)  Federal Reserve Chairman Ben Bernanke on Monday called for the United States to eventually whittle down its record-high budget deficits and for countries like China to get their consumers to spend more, moves that would help combat skewed global trade and investment flows that contributed to the financial crisis.

Bernanke's remarks to a Fed conference in Santa Barbara, Calif., comes just days after the federal government on Friday that ended Sept. 30. The previous year's deficit was $459 billion.

The Fed chief's comments were aimed at reducing global imbalances, and echo pledges made by leaders of the Group of 20 nations at their summit in Pittsburgh last month.

"As the global economy recovers and trade volumes rebound, however, global imbalances my reassert themselves," Bernanke warned. For the United States' part, "the most effective way" to boost national savings in this country "is by establishing a sustainable fiscal trajectory, anchored by a clear commitment to substantially reduce federal deficits over time," Bernanke said in prepared remarks. He didn't suggest ways to do so.

And, for trade surplus countries like China and most Asian economies, they need to get their consumers to spend more and relay less on export-led growth, Bernanke said.

"In large part, such action should focus on boosting consuption," Bernanke said

[nearl451]

Wasn't this the same guy who started the panicked bailout deficit started?

I don't quite get this. Doesn'tknow how to reign in the deficit, but wants it lower.

Yeah. me too.

[timetocomeclean]

One comment for Chairman Bernanke, not to be confused with Chairman Mao.

Repeal the expensing of employee stock options. During the so-called Reagan revolution, which a mistake of common sense by the Republicans, we saw the greatest era of high-tech incubation in the history of the world.

Look at companies like Microsoft, Cisco, and others that profitted from this one business tool.

Common Bearded Ben, get your head around this idea and get Mr. Obama and the other administration boys and girls to repeat after me,
'No tax on employee stock options,' over and over again.

Ask the 14th Dalai Lama of Tibet what scares the crap out of the People's Republic of China and keeps them up at night?

That The United States doesn't come to its senses abandons its love of monopolies and wants small business to suceed again. Where is Oprah when you need her Ben, or has she become a monopoly too?

You are dismissed.

[reality42]

If USSA wants china to buy more then USSA show drop there wags to $4.00 a day andf that is twice as much as what the chinese were making when the USSA bought all there stuff and marked it up. Love the way USSA changes the rules all the time to benifit them

[bajajohn1]

This boys and girls is not rocket science. Best way to cut the size of the deficit is to eliminate useless federal programs, eliminate the Bush tax cuts to the wealthiest 1% of Americans, close off-shore tax loopholes and increase spending for retired folks so they can consume more and fire up the economy.

[stevador39]

THE BAIL OUT IS A BIG CAUSE OF THIS PROBLEM. THE FEDERAL RESERVE AND BEN BERNANKE NEED TO BE ELIMINATED.

[jntlw]

Get rid of Bernacke, he is so abviously an insider - get rid of the Fed and thus his offic. New law - no one whoever worked for Goldman Sachs or any bank can be the secretary of the treasury, Fed chairman, or whatever position Geithner holds. They are going to be the start of a revolution in this country - the poor will rise up and get rid of the rich!!! They actions are begging for it!

[barber1956]

Obama is doubling down on Bushs Magic Checkbook Plan -
Clinton was the last Pres to get it - and we need him back.

You cant Tax your way out of this - but Obama is going to try -

[Constitionalist]

It took how many years of experience and schooling to realize what us average stupid citizens already know? He still doesn't quite get it. He just wants to "reduce" the deficit. We need eliminate the deficit and pay off the debt. That is not what the federal reserve really wants, though. They are a privately owned bank out to make a profit on the backs of the american people. Thus, debt is essential to them. As long as we allow the to directly, or indirectly (Tim Geithner), dictate national policy we will remain slaves to them.

[parisdakar]

No kidding, Ben. Any regular citizen in this country could have told you that big deficits are bad. The government is doing the very same thing that caused this mess in the first place. Borrow and spend. Can't afford something? Just put it on the credit card. Or in this case, put it on Uncle Sams tab.

[jxknowles]

He's right. Have to start cutting. Start with Iraq, move on to Afghanistan, then chop the GOP Congress salaries to the days they actually bother to work.