If You're A Saver, Ben Bernanke Has A Special Message For You

Business Insider ^ | September 14, 2012 | Joe Weisenthal

[SoFloFreeper]

One of the most powerful moments of Ben Bernanke's press conference yesterday, after the Fed announced Unlimited QE, was when he refuted some myths about Fed action before he started the Q&A.

In particular, he took on the idea that the Fed was screwing savers because rates are so low, and you can't get any return holding money in the bank.

Here's what he said:

On the second concern, my colleagues and I are very much aware that holders of interest- bearing assets, such as certificates of deposit, are receiving very low returns. But low interest rates also support the value of many other assets that Americans own, such as homes and businesses large and small. Indeed, in general, healthy investment returns cannot be sustained in a weak economy, and of course it is difficult to save for retirement or other goals without the income from a job. Thus, while low interest rates do impose some costs, Americans will ultimately benefit most from the healthy and growing economy that low interest rates help promote.

So in other words: The main thing is that you can't save if you don't have a job, and that's what the Fed is trying to address. Furthermore, there are lots of kinds of assets that do benefit from low rates.

When the economy returns to health, savers will be able to get paid, just like everyone else. But until then, there's no special right to earn income on having money in a bank.

[Yosemitest]

I take possession.