WASHINGTON -- Federal Reserve Chairman Ben Bernanke pledged anew Wednesday to do everything in his power to lift the country out of recession, while defending the extraordinary steps the Fed has taken to fight the worst credit and financial crisis since the 1930s.
The central bank has slashed a key interest rate to record lows and has launched a series of radical programs in hopes of getting credit — the economy's oxygen — to flow more freely again to American consumers and businesses, and stabilize Wall Street. Such relief would help revive the U.S. economy, which has been mired in recession since December 2007.
"Recent economic statistics have been dismal, with many economies, including ours, having fallen into recession," Bernanke said in remarks to the National Press Club. "In the United States, the Federal Reserve has done, and will continue to do, everything possible within the limits of its authority to assist in restoring our nation to financial stability and economic prosperity as quickly as possible."
The Fed has been exploring new tools — as well as expanding existing programs — to provide further economic and financial relief, although Bernanke didn't provide any new details on Wednesday.
With all the Fed's programs to provide loans or buy debt, its balance sheet has mushroomed to just under $2 trillion, from around $900 billion in September.
Critics worry the Fed's actions have the potential to put ever-more taxpayers' dollars at risk, spur inflationary pressure in the future and encourage "moral hazard," where companies feel more comfortable making high-stakes gambles because the government will rescue them.
Bernanke, however, sought to downplay some of those concerns.
"The credit risk with our nontraditional policies is exceptionally low," he said, adding that when the economy is on the mend, the Fed's programs can be quickly reversed "to avoid risks of future inflation."
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