Bernanke defends Fed Actions, Fed Predictions Gloomy

Fed Chief Defends Steps Taken to Contain Crisis
Switching from political cartoons to the economy…
The chairman of the Federal Reserve, Ben S. Bernanke, vowed on Wednesday to do whatever it took to pull the economy out of its downward spiral, even as he acknowledged that the most recent indicators were “dismal.”
Mr. Bernanke defended the central bank’s efforts and tried to allay concerns that it had been printing money at a dangerous pace.
“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,” he said.

The real kicker is down in the piece:
The “central tendency” of forecasts by the presidents of the Federal Reserve’s district banks and of governors on the Federal Reserve Board showed that they expected unemployment to reach 8.5 to 8.8 percent in 2009. Last October, policy makers expected unemployment to top out at 7.1 to 7.6 percent.
Fed policy makers also expect the economy to shrink this year in a range of 0.5 to 1.3 percent, which mainly reflects deepening gloom about the severity of the downturn in the first half of this year. Last October, most Fed officials had predicted that the United States would come out of the recession quickly enough to end this year with a small gain.

Anecdotal note. The Fed’s meetings are expanding from 1 to 2 days through 2010.
The Head of the Chicago Fed so has a recent speech on the state of the economy–his own view, not the consensus of the FRB system.