Tags: federal reserve | ben bernanke | job market | gloom

Fed's Bernanke Too Gloomy on Job Market, Mitsubishi’s Herrmann Says

Friday, 24 May 2013 12:59 PM

Federal Reserve Chairman Ben S. Bernanke is too gloomy about the U.S. job market, said John Herrmann, director of U.S. interest-rate strategy at Mitsubishi UFJ Securities in New York.

“We’re surprised that Chairman Bernanke and some people in the Fed didn’t say: ‘Hey, listen, we are seeing good jobs,’” Herrmann said in an interview with Betty Liu on Bloomberg Television’s “In the Loop” Friday.

“We need someone at the Fed who is in command to say, ‘Look, we are seeing good job gains.’”

The labor market’s strength is a key factor for Fed officials who are debating when and how to dial back an $85 billion monthly bond-purchase program designed to spur growth and hiring.

Bernanke indicated May 22 that the Fed is seeking “real and sustainable” progress in shrinking unemployment before it begins to pare record stimulus, through such measures as reducing or tapering monthly bond buying.

Herrmann said that Bernanke “has sort of a predisposition” and a “negative bias” that the U.S. is under a constant risk of a slowdown. Private-sector hiring seems sustainable and may exceed 180,000 a month this year and early next, Herrmann said.

Employers added 165,000 workers to payrolls in April after a gain of 138,000 the prior month, according to Labor Department figures issued earlier this month. The jobless rate dropped to a four-year low of 7.5 percent as private payrolls increased by 176,000 in April.

As the employment lags in small businesses, Bernanke needs to encourage Congress and President Barack Obama to generate policies supporting entrepreneurs, Herrmann also said.

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Federal Reserve Chairman Ben Bernanke is too gloomy about the U.S. job market, said John Herrmann, director of U.S. interest-rate strategy at Mitsubishi UFJ Securities in New York.
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2013-59-24
Friday, 24 May 2013 12:59 PM
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