Bernanke Says Recession Is Probably Over

The recession is probably over, at least from a technical standpoint, Federal Reserve Chairman Ben Bernanke said Tuesday, although the economy will likely continue to struggle for another year or more.

Speaking before a conference at the Brookings Institution on last fall's financial crisis and the current state of the economy, Bernanke said that even though the economy appears to be growing, the pace of that growth will likely remain slow through 2010 due to underlying weaknesses, including ongoing credit problems and reduced property values that have affected the personal worth of homeowners.

"It's still going to feel like a very weak economy for some time as many people will still find that their job security and their employment status is not what they wish it was, and so that's a challenge for us and all policymakers going forward," Bernanke said.

Although acknowledging that economic predictions often turn out to be more optimistic or pessimistic than borne out by subsequent developments, Bernanke said current indications suggest the economy will likely not significantly exceed its underlying long-term growth rate, which is needed to create jobs.

"Unemployment will be slow -- slow to come down," he said. "It will come down, but it may take some time."

Employment is often one of the last things to recover following a recession, because employers want to be sure there will be increased demand for their goods and services to justify hiring additional people. From an economist's perspective, a recession is considered over when the gross domestic product (GDP) begins to rise, however slowly, a turning point that may not have an effect on employment levels for some time to come.

The remarks on the economy came during a question and answer session following Bernanke's prepared speech. His speech primarily focused on defending the Federal Reserve's response to last fall's economic crises and subsequent efforts to invigorate the economy and prevent it from falling into a deeper recession or depression.

Bernanke was recently appointed by President Obama to a second four-year term as chair of the Federal Reserve.