(Mandel Ngan/AFP/Getty Images)

Federal Reserve Chairman Ben Bernanke on Wednesday said the Fed will start winding down monetary stimulus later this year if employment numbers continue to improve. Bernanke said the economy is expanding at a moderate rate, and risks to the recovery have “diminished since last fall.” But experts disagree about how optimistic we should be about the economy. UCLA’s June forecast says that despite improvement, the U.S. economy is not in recovery. We take stock of the national and state economies.

Guests:
Jerry Nickelsburg, adjunct professor of economics at UCLA's Anderson School of Management and senior economist for the UCLA Anderson Forecast
Peter Coy, economics editor for Bloomberg Businessweek
Christopher Thornberg, founding partner of Beacon Economics, an independent economic research and consulting firm headquartered in Los Angeles

  • Narnio

    If magical thinking is what they are still teaching in economics courses (as far as I know it is), and what they are teaching in economics courses is the basis for accepted truth (it is), then of course the economy is recovering and the big banks are innocent of all serious crimes and life in America has never been better. But as with all things, if the premise is wrong then what follows from it will likely be too, and the premise that magical (neoclassical) thinking can describe our economic system accurately is wrong for several reasons, not least of which being that they don’t figure private debt into their models.

    Professor Steve Keen explains we need debt nullification:

    What’s wrong with economics:

  • William – SF

    Any chance an economist can describe components that would make up a good economy (to have living wages, prosperity for all, …), or are economist only good at describing the wag the dog makes?

  • Chris OConnell

    Economic growth is a threat to the planet, not only because of global warming but because the planet is FINITE. Yet all we want, and all we demand is continuing “growth.” Not even year to year but every quarter.

    “Brothers say goodbye
    Sisters don’t you cry
    All embrace the times
    Wade into the changing tide”
    – Bad Religion

    • thucy

      definitely the real story

  • Chemist150

    Waxing philosophical is not working with this guy. Bernanke was doing QE to make up the money supply because that what drives the economy. With so much of the money supply heading overseas through debt and trade deficit, he needed to make up the money supply with QE. By buying our own bonds, he reduces the interest rates to get the final little edge on inflation here to help.

    With the reduced deficit from the sequester kicking in, he can back off a bit because the money supply drain has slightly eased but Congress needs to continue on the path of fiscal responsibility and improve the money supply through reducing debt so the money can come back to the US.

    The markets tank because the traders realize that the companies stocks they own have debt associated with that. As their interest rates increase, the return on investment will decrease. There will be projected quarterly targets missed because of increased interest payments. Dividends will be cut to compensate. There is real reason investors respond. They pull their money down, let it equilibrate some and re-enter the market.

    • Chemist150

      He can say that people should be pulling money out and buy later but it save me money by selling ahead of time by selling the stocks of companies with higher debt.

      Banks will be the next to rise in value as interest rates go up. He can blindly put his money where ever he likes but a mild intelligence to the situation can lead to higher gains.

  • commonsense1234

    My concern is that the sequester later this year is going put a drag on aggregate demand. Given that the Q3 has had only marginally stimulated the economy, how can the Federal reserve push banks to actually lend more since they are sitting on a huge amount of reserves?

  • commonsense1234

    Because of the obstructionist House GOP and the lack of stimulative fiscal policy, is Bernanke simply waiting on for the housing market to recover in order to stimulate the overall economy?

  • Fay Nissenbaum

    The Fed itself in March said student loan debt is a real drain on the economy. As for the elites, the banks borrow money from the Fed for near nada then turn around and make money instantly while still keeping a stranglehold on credit and credit card rates. Elizabeth Warren advocates that students should be able to borrow at the same rates the banks do – which we subsidize. Do you experts disagree with Warren?

  • Fay Nissenbaum

    Well, great @55minutes into the show – “just go out and buy a house”. in other words, “Eat cake!”

    • Narnio

      I was surprised that Krasny let that boor get away with saying that.

  • Chris OConnell

    Thank goodness for the callers for presenting the left(out) but right (correct) perspective

  • timholton

    Seems to me our policies are aimed at using US taxpayer dollars to support corporate growth, but that those corporations benefiting from the policies are typically a) globalized and are putting their money not into the U.S. economy but into foreign markets where growth and therefore return on investment is greater; and b) primarily and increasingly interested in liquid capital rather than real wealth such as land and agricultural stewardship, manufacturing infrastructure and job creation. National governments are incapable of addressing the shortcomings of global financial capitalist enterprise. Why do we continue to have conversations that presume they are?

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