US Fed chairman Bernanke says recession could end this year

March 16, 2009

In a rare television interview, the chairman of the United States Federal Reserve, Ben Bernanke, said that the country's recession will "probably" end this year if the government is able to bolster the banking system.

Speaking on the CBS network "60 Minutes", Bernanke said that recent efforts by the government probably avoided a depression similar to the one that occurred in the 1930s. He also said that he didn't expect any of the US's largest banks to fail. However, he stressed that the prospects of ending the economic downturn in 2009 probably relied on getting the financial markets working normally and making the banks to lend more freely again.

"We've seen some progress in the financial markets, absolutely. But until we get that stabilized and working normally, we're not going to see recovery. But we do have a plan. We're working on it. And, I do think that we will get it stabilized, and we'll see the recession coming to an end probably this year," he said.

Bernanke noted that he expects the unemployment rate will continue rising above the current 25-year high of 8.1% even if the government is able to end the 15-month recession.

The chairman said that the largest possible danger now was the absence of "political will" to fix the economy.

Bernanke is the first incumbent Federal Reserve chairman to take a television interview for two decades. The chairman said that he decided to do so because it was an "extraordinary time" for the US, and it gave him an opportunity to speak directly to the public.