Bernanke: Fed Program Could Help Create 1 Million Jobs

The Federal Reserve's efforts to stimulate the economy could lead to the creation of as many as 1 million jobs, Fed chairman Ben Bernanke said, according to Senator Richard Shelby (R - Alabama), Bloomberg reports.

The quantitative easing program, in which the Fed will buy up to $600 billion of U.S. government debt from clients including the nation's biggest banks, has come under fire in recent weeks, as government figures and civilians have subjected the Fed to an unusual amount of criticism.

This week, Republican leaders in Congress said they wanted to strip the Fed of its goal of fostering "maximum employment," leaving it with only its responsibility to oversee "price stability."

But for now, at least, promoting employment remains one of Bernanke's official goals. And according to Bloomberg's report, he's confident the monetary policy efforts will encourage job creation.

In a private meeting with senators, Bloomberg says, Bernanke estimated quantitative easing could help create between 700,000 and 1 million jobs, according to Alabama Senator Richard Shelby, the senior Republican on the Senate Banking Committee. "He basically defended his position," Shelby said, according to Bloomberg.

But recent developments challenge Bernanke's optimism. As Bloomberg reported yesterday, some companies are planning big expansion projects overseas.

As Reuters' Felix Salmon said in a recent video, money is "sloshing" everywhere except where Bernanke wants it to slosh -- to job creation. Only a restoration of confidence (and consumer demand), Salmon said, will encourage companies to create jobs.

The economy added about 151,000 jobs last month, but the unemployment rate remained at 9.6 percent. As AP noted, the economy needs to at least 100,000 jobs per month just to keep pace with population growth.

Comments

[Tierce]

03:25 PM on 11/22/2010

Only 4 million more and we'll get caught up and all have jobs again.

[tribilin219]

09:42 PM on 11/21/2010

Great 1 Million jobs, Where in Washington?

[Melissa Serviteur]

05:53 AM on 11/21/2010

A million jobs? Full-time permanent with benefits? I want some of what Boom-Boom Ben is smoking!

[AZreb]

09:46 PM on 11/20/2010

"Could" help create a million jobs.

Is this another "coulda, woulda, shoulda" from the Federal Reserve?

[mrcontinental]

11:36 PM on 11/20/2010

The jobs will be as psychiatrists, therapists, grief counselors, and undertakers for the millions of formerly middle class americans who will find themselves without a future.

[Old Claudius]

05:55 PM on 11/20/2010

Being a product of scientific mathematical education, I was taught exponential-form power-of-ten scientific-notation for large numbers. All the zeros in accounting-figures notations are confusing to me.

That's why it took me a while to do the math on Ben Bernanke's offer.

If I have it right now, though, what I have is Ben Bernanke offering to create one million (1,000,000) jobs for the paltry sum of six-hundred billion dollars ($600,000,000,000).

Does that come out to six-hundred thousand dollars a job ($600,000 : 1 job)? Or did I make a mistake somewhere?

Assuming the jobs will be service-sector, since the military equipment manufacturing jobs are all taken and other manufacturing has gone overseas, the pay will be about $10 per hour per job. At that rate each of the jobs will pay $400 per week, which is $1600 per month, which will add up to $19,200 per year.

It will take each person who gets one of those jobs 34 years and 3 months to recover the $600,000 making the job will cost.

Is this a good deal? Is there an economist out there who can explain it to me?

Am I naive to think that if they just made a random pick of 1,000,000 unemployed and gave each $600,000, to pay bills, deposit in their local banks, start businesses, hire neighbors, etc. it might do more for the economy?

[AZreb]

07:20 AM on 11/21/2010

Fanned - when we take the time to actually "do the math", it just doesn't make sense. But too many times we are blinded by the so-called "experts" and the billions and trillions being thrown around like confetti.

Makes me wonder if Congress is being blinded, too - most of them are not economists, have not had accounting classes and are being led around by the noses by those who claim to "know what's best" for our economy.

Then, too, we have Geithner - one of the poorest excuses for a Secretary of the Treasury that I can remember.

[VoteThemAllOut]

05:47 PM on 11/20/2010

If I counted the zeros correctly, this 'brain f_rt' will create 1 million jobs for $600 billion, that works out to a very economical cost per job of $600,000 each. Where do I apply?

[Melissa Serviteur]

05:55 AM on 11/21/2010

When the full implications of QE2, QE3...QEx play out, on a $600K income you still qualify for food stamps. Ho, SNAP! Love your handle; couldn't agree more.

[Trythis]

09:31 AM on 12/03/2010

Do you have white collar crime skills or knowledge?

[BlueSkyPilot]

01:27 PM on 11/20/2010

The top two percent accounts for about 640.000 Citizens. They will each need at least one more Body Guard to protect them, some will need two so yep! That's almost 1,000,000 jobs.

[JackTheSkipper]

10:07 AM on 11/20/2010

Bernake, just wait until JAN after GOP takes the house. They will be for it because they will take the credit for job creation.

[jo smith456]

08:31 AM on 11/20/2010

WARNING:
"quantitative easing", a new term for currency manipulation called "printing money" is banks bailout in DISGUISE; they're at it again:
http://theeconomiccollapseblog.com/archives/the-biggest-bank-robbery-in-history-more-quantitative-easing-backdoor-bailouts-for-the-big-banks-without-having-to-go-through-congress

SPECULATIVE (hedging/derivative, etc.) investments do NOT create REAL JOBS!!! Banks just move money around. And banks are one of the biggest outsourcers of jobs.

OMG. It never stops. Americans WAKE UP.

[Name Not In Use]

07:04 AM on 11/20/2010

ALERT ALERT ALERT!!!!

"Fed will buy up to $600 billion of U.S. government debt from clients including the nation's biggest banks,"

Which means that the "clients" cannot sell this U. S. Government debt on the open market for as much as the Fed is paying them.

Read that again:

"the "clients" cannot sell this U. S. Government debt on the open market for as much as the Fed is paying them."

"the "clients" cannot sell this U. S. Government debt on the open market for as much as the Fed is paying them."

"the "clients" cannot sell this U. S. Government debt on the open market for as much as the Fed is paying them."

U. S. Government debt is officially hosed!!!!

Head for the hills!

Look out fans ... here it comes!!!!

[Name Not In Use]

06:58 AM on 11/20/2010

Didn't the Ben Bernank see the YouTube video????

http://www.youtube.com/watch?v=PTUY16CkS-k

[jalaroc]

11:33 PM on 11/19/2010

Fed program could create up to a million jobs...overseas. It amazes me how naive Bernanke seems. Appealing to a sense of responsibility in the business sector is like appealing for mercy to a rabid grizzly while holding a raw steak in each hand.

[Name Not In Use]

06:59 AM on 11/20/2010

It amazes me how naive Bernanke assumes we are.

But he seems to be right ...

[Trythis]

09:34 AM on 12/03/2010

Ben's not naive - he's a L*I*A*R and a crook.

[hey0there]

08:05 PM on 11/19/2010

We can't afford to gamble away money on 'COULDS' Mr Bernanke. People in finance have showed a remarkable propensity for lying about future results & you've done nothing to gain our trust. Come up with a 'WILL WORK' plan and we can talk.

It COULD also plunge is even further past the point of no return

Stop GAMBLING with the US!!

[jo smith456]

07:47 PM on 11/19/2010

Oh-Oh!!! HERE WE GO AGAIN!!!!!!!!

[avg american]

04:57 PM on 11/19/2010

What about the other 20+ million unemployed?

I have a better idea.
Put all of the banksters and investment crooks in jail and seize their assets to pay off the national debt and create jobs. The DEA seizes drug dealers' assets, why can't the FBI seize the money and property from the corp crooks?

[mamacat]

05:33 AM on 11/20/2010

GOP politicians are in the pockets of the corporate crooks. Put the corporate crooks in jail, and the GOP pols would have to go with them.