Bankruptcy

This Week in the U.S. Economy: Bernanke Second Term, Consumer Confidence & Home Prices Rise

By Meaghan Olson

The past seven days have been fairly significant for the United States, economy-wise.

Here?s a brief summary of three major stories you should know about.

Ben Bernanke: Nominated for a Second Term

President Obama took a break from his vacation on Tuesday to announce his re-nomination of Benjamin Bernanke as Federal Reserve Chairman.

If approved by the Senate, Bernanke will serve his second four-year term.

Since the economy hit the skids in 2007, Bernanke has:

• Lowered the main interest rate to near zero and funneled almost a trillion dollars into U.S. banks to mobilize credit
• Handled the financial crisis with ?calm and wisdom,? according to Obama
• Been criticized by legislators for reacting too slowly when early warning signs of trouble in the mortgage market showed themselves.

Bernanke is a Republican. Read his statement of acceptance.

Consumer Confidence Rises Above Expectations

The Conference Board published numbers showing that consumer confidence in August is up substantially from July. Specifically:

• The Consumer Confidence Index currently stands at 54.1 —  in July, it was 47.4 (a level of 90 is required for consumers to be considered ?optimistic?)
• The Present Situation Index rose from 23.3 in July to 24.9 this month
• The Expectations Index rose from 63.4 last month to 73.5.

Economists look to these numbers in part because the United States has a very consumer-driven economy, meaning that long-term recovery will depend largely on the behavior of the average shopper.

Home Prices Jump in First Quarter

The latest report from the S&P/Case-Schiller Home Price Index shows a 2.9% increase of housing prices in the first three months of the year.

Though a small gain, the move is an important landmark: the first increase in home prices in three years.

This is good news, but not great: home prices are still down 14.9 percent from the second quarter of 2008, but that?s better than where they stood three months ago, at 19.1 percent below.

The rise could be a sign that bad times are over, but may just be a temporary upswing.

–Even though there’s some good economic news to report, many Americans are still hurting. If you’re having trouble making ends meet, it may be time to think about filing bankruptcy.

Full post as published by The Bankruptcy Blog on August 26, 2009 (boomark / email).