Bernanke Speech - Oct 7 - Economic Outlook Weaker

On October 7th, 2008, Fed Chairman Ben Bernanke predicts the global financial crisis is likely to hold back the U.S. economy well into next year. Recent financial developments suggest that "the outlook for economic growth has worsened and that the downside risks to growth have increased," he said. Bernanke signaled the Fed may cut interest rates. Bernanke is clearly worried that the economic downturn now underway may last longer and go deeper than he expected. Financial markets have been clamoring for another rate cut given the turmoil in recent weeks that has seen major U.S. investment banks close down, merge, or transform. The stock market extends its decline, now down more than 2%. All ten sectors are posting a loss as buyers sit on the sidelines. Market breadth is bearish. Declining issues outpace advancers by nearly 3-to-1 on the NYSE and by 11-to-5 on the Nasdaq. Volume is less than the previous session's level at this time, but is more than the average over the previous 10 sessions. Fed Chairman Bernanke is set to speak in about 15 minutes on the economic outlook and financial markets.