it was full disclosure about who gave what to whom. that bill does not go anywhere. i don't think it will go anywhere in the republican congress. i don't know what the remedy is. >> have time for one more question so a better be really, really good. who would like to be on a hot spot for the best question of the day? you can't go twice, mr. weiner. adam, would you like to ask a question? the president came out the other night and did not look terribly happy. i think i was in the second row. no matter what your politics are, we saw a wounded man, basically, and he said he feels bad. the question was, was a the democratic party and this white house that was not able to sell good policy or did the american people not understand the policy or did they reject the policy? is it about the message, policy, politics? i think we will probably not get an answer to this question but i would like -- it is about 10 seconds from each of us to get final thoughts. i think that is what seminar round table is about. let's start with henry. >> i think it was about policy. it is hard to completely divorced message from substance. there has been five elections since the great depression republicans made massive gains in congress and was always in reaction to large, rapid expansions of federal power where republicans ran essentially as the party of saying let's stop this. i don't think it is a poor into this. i think something about the american middle, particular about the working class, that does not want rapid, sudden expansion of federal power in this election fell into a long 60 + year pattern. >> let's go across the pond and ask you. >> what has struck me from the contributions of all the americans here where they are the political spectrum is the common level of disappointment in the obama residency. >> lynn? >> i think the message was jobs and there is some statistics in the science committee that saw a big republican gains early in the year before obama's popularity started dropping as low as it did. i think this was a message in this election that drives from the economy more than anything else. >> harold? >> i think it is a combination. many people -- many different people voted in this election. if you did a random sample, you have different people getting different answers out as to why they voted. my sense is that there is an enormous disappointment, to put it mildly, in the results. you can characterize it that that they don't like the policy and many people are saying they expected more and they are really hurting. they are sending a message to all sides, tea party people, republicans, and the democrats, something has to be done to change our circumstances and if it is not, we don't know how we will vote in the future. >> i want to thank all of you and they're wonderful panel and we would hope at some point that we may do this again and thank you all and thank youdean and thank jeff anderson, you recover quickly and get back from the soccer field. thank you all so much. thank you. [applause] h[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] next, remarks by federal reserve chairman ben bernanke and after the president obama on the october unemployment rate had live at 7:00 a.m., your calls and comments on "washington journal." this weekend on "afterwards" 12 u.s. presidents elected since world war two are profiled. it is an interview with presidential historian richard norton smith, this weekend on book-tv on c-span 2. now, federal reserve chairman ben bernanke speech to students at jacksonville university in florida. this event comes two days after the federal reserve's policy- making panel, the federal open market committee, voted to buy an additional $600 billion in bonds over the next eight months to help stimulate the economy. this is about 45 minutes. >> now the federal reserve chairman ben bernanke speaks to students at jacksonville university in florida. this incomes two days after the fed policy-making panel voted to buy an additional six and a billion dollars in bonds over the next eight months to help -- $600 billion in bonds over the next eight months to help stimulate the economy. >> i do not want to spend all the time talking at each. i bet i've talked to -- i thought i would talk for a few minutes and then i will be happy to take questions after that. the federal reserve has two broad functions. the first one is to promote financial stability. that is what the federal reserve was founded four. there is a crisis in 19 07. -- 1907. leaders got together to figure how to structure this instability. there is another crisis in 1914. it the fedders is being created at that time -- there was another crisis in 1914. the fed was just being created at that time. the fed did not do is stop during the great depression. i will talk more about that. one of the major features of the great depression was a near collapse of the banking system which led to a collapse of the money supply. the federal reserve has basically two tied it kills the we can use to maintain stability. -- two types of skills that we can use to maintain stability. if you think about what a baby does, they take short-term money and invest it in long-term liquid assets. there is a problem and that transformation. it depositors to lose confidence in the bank, they will demand their cash. if the bank only has long-term assets, it and not able to pay off the depositors and it will sell. with a lender can do is provide cash, taking the long-term assets. it allows the bank to essentially make liquid the assets and pay off the depositors to stop the run. we know from several hundred years of monetary theory that the way to stop the panic is to lend freely to institutions that are temporarily liquid. the other told the fed has -- tool the ban has is that it is a regulator. there are earnings, liquidity of bank holding companies. in trying to insure that things are safe and sound, we tried to prevent financial crisis. the other main task that the fed has is the macroeconomics task. congress has given the fed a dull mandate -- duel mandate, maximum employment and price stability. that means keeping inflation low and stable. you are all familiar with monetary policy. they will be able to manipulate the short-term interest-rate. that helps the fed keeps the economy on an even keel so that we have neither too much inflation nor too little. those are the two broad tasks that the federal reserve does. in the last three years, we have been faced with extraordinary event and have tested both sides of that mandate to extreme degrees. on the financial stability side, we used all our tools. when the crisis began in august of 2007, some of the first problems were liquidity problems in the banking system. this is what we learned about in studying a book called "lombard street." they can provide the telecast to their creditors. we created an auction facility that will provide large amounts of cash and allow banks to become more liquid and more stable. the problem was that the crisis morphed into a much broader phenomenon. in the 1930's, the entire financial system was made for the banks. if you stop the depositors from running, you stop to the panic. -- you stopped the panic. one of our most significant runs we had in 2008 to place on money-market mutual funds. they are mutual funds with very liquid shares that their depositors put in. they invested in short-term safe assets. following the collapse of lehman brothers in 2008, they lost money on commercial paper that it held. suddenly come if it cannot pay of the depositors -- suddenly, and they could not pay off the depositors. that created a new run. they are major suppliers of cash to corporations. the commercial paper market rose up. the fact that our modern system has all kinds of institutions that have been quite futures and more illiquid assets meant that this iran problem -- run problem began in other contexts. the same thing happened with aig or they were funding on a short-term basis and they had a liquid -- illiquid assets. it was a panic generated by the withdrawal of cash. we went through a whole series of programs to try to get the markets working again. for money market mutual funds, we were able to lend to them so they could pay off their depositors. it is supplemented where the treasury ensure the deposits. in the commercial paper market, the allow corporations to meet their financing needs. they need the cash to pay off their creditors. we expanded it to a wide variety of institutions. working with the treasury and other banks, we helped to stop the panic of 2008. we need to know when to make loans to provide the lenders to stop the panic. i mentioned the other part of our tool kit for dealing with financial instability, our supervisory tool kit. we were examining what was going on at other financial institutions and trying to figure out where there were problems. a very important example was in the spring of 2009 when we and the other agencies did a stress test. we took all the biggest banks and we did a simultaneous and evaluation of all their assets and losses and we publish that information for the public. it had a great effect. investors had the information they needed about the health of the banks. any problems or taking care of. the other banks found they could go to the stock market and raise new capital. they were able to do that. we are able to help stabilize the banking system. going forward, the fed has even more expand its supervisory powers in part because of the result of the new legislation. we will be looking at a number of other kind of institutions including non-banking institutions if they are deemed "systemically critical." we have broader authority is going forward. we are working with our counterparts in switzerland to set of new capital standards. the more painful, the saker they will be due the more they have, if the state bird they will be -- the more they have, the state for they will be. the other part of our general assignment as the macroeconomic part. when the crisis led to a deep recession, and the financial crisis in 2008 led to a very sharp global recession that lasted to 2009. they tried to provide support for the u.s. economy. we cut interest rates sharply. we kept them before the height of the crisis. -- cut them before the height of the crisis. before december 2008, we have cut the federal fund rate than we used to target financial institutions to almost zero. with that interest-rate almost at zero, some people might say the fed to go home. there is nothing else they can do. we took additional steps. we developed a new type of policy that involves buying long-term securities such as mortgage-backed securities guaranteed by fannie mae and freddie mac for treasury securities, government debt. we purchased those from the market and brought them in. we provided more support to the financial markets. we did some very big step along those lines in march of 2009. at that time, the economy was in bad shape. i do believe this actions did help. they brought down interest rates. shortly after, we saw the economy begin to recover. even though we were at zero, we had an additional tool that lets as provide further support for the -- that let us provide further support for the economy. even the economy is no longer in a recession in the sense that it is expanding, it is not growing very fast. as a result, the unemployment rate is coming down very slowly. when it the mandate is maximum unemployment -- one of the mandate is to provide maximum employment. we are showing in sufficient stimulus. to provide additional stimulus, the federal market committee voted to increase to buy additional securities in the open market with the goal of reducing interest rates, providing more stimulus, and we hope to treat a faster recovery and inflation rate consistent with long-term stability. we will review that. it has been an interesting three years. we are doing what central banks are supposed to do. the nature of the crisis means we have had to use a whole lot of approaches that have not been used before by the federal reserve. that is very important. let me just got there. that is a quick overview -- let me stop there. that was a quick overview. that me see if anyone has any questions. >> thank you for coming. you have mentioned that the federal reserve sees an extended time of low inflation which could threaten the economy. i see commodity prices skyrocketing. a feeling that commodities such as cotton and sugar -- you look at commodities such as cotton and sugar, it seems like producers are eating most of the price increase. i think that could be trickling down to the consumer next year. do you see any possibilities to that threat for low inflation? do you think there is a possibility of higher inflation next year? >> er right. the one exception to the general observation that is coming down is that globally traded commodities like energy and food have been going up pretty sharply. the supply and demand is determined on a global level. a emerging-market occurring quite quickly. the demand is pretty strong. that will be a contributor to inflation in the year west it will affect -- inflation for the year in the u.s. it will affect it. there is a lot of slack in the economy and excess supply. it is very difficult for producers to push through those costs to the consumer. most of the costs the producers have our labor costs. productivity has been growing strongly. the cost of labor per unit of production is actually falling in some cases. you have higher energy and material cost. you put that together and you do not expect to see very much inflation to final goods and services. inflation is going to stay quite low going into next year. commodity prices are an issue. i think it'll take at least some further growth and a reduction in slack before we start to see any kind of inflation pressure. then we will have to be sure to modify our amount of stimulus to make sure we maintain stable prices in the long term. anybody else? >> good afternoon. my question lies with what you did with the "washington post." your answering the people about the six and a billion dollar purchase of securities. your company -- $600 billion purchase of securities. you said your company was confident. how will you do it? >> what the purchases do -- if you think of the balance sheet, on the asset side of the dollar sheet we get the dollar security. on the liabilities side, to balance that, we create reserves in the banking system. what these reserves are are essentially deposits at commercial banks go with the fed. the amount of cash in circulation is not changing. banks are holding more reserves with the fed. the question arises of what happened when the economy is growing more quickly and it is time to pull back the monetary policy accommodations. there are several tools that we have. the first one is that the main thing we need to do when it is time to do it is raise interest rates. that is what we always do. even though there is a large amount of excess reserves, can we raise interest rates? the answer is yes. we have been giving the authority by congress to pay interest to the banks. if we wanted to raise the short-term to 2% -- they would have no incentive to take them elsewhere. by raising that interest-rate, we could essentially raise short-term interest rates throughout the system. that is basically what the fed does one ever it tightened monetary policy. -- whenever it tightened monetary policy. and have a large amount of reserves, it could be that some will leak out even those we have raised the interest rates that we pay. we also have developed a number of tools to drain or immobilize the reserves of the cannot go out into the economy. one way we do that by treating time deposits. inurbane he can have a regular -- creating time deposits. in the bank, he can have a regular deposit. they can hold reserves with us for three months or longer. by doing that, we freeze freezer so they cannot do it. one way is to do by replacing reserves with other types of financing. we can borrow from money market mutual funds. we have a variety of ways of draining those reserves. finally, if we wanted to do additional training, we could sell the assets that we owe. if we sell the assets, that will tighten policy in a few ways. when you sell assets, it distinguishes the reserve. assets and liabilities will both come down to get there. we have the these three broad tools. we pay on raisers in order to tighten financial conditions. tools we have to immobilize them and sell assets. we have plenty of tools. we have done plenty of work to make sure they are tested. we have tested them successfully. we are comfortable that we will be able to do it when the time comes. >> thank you. the university of florida. my question has to do with the decision to buy $600 billion in securities. there have been some complaints from developing nations, particularly in south america and south korea, that this decision might create some sort of influx of foreign capital that could inflate assets of bubbles. my question is not about your opinion on that and how the open market committee factors things like that into their decision making process. do they take those things into account when they are deciding to buy its assets? how big do these things factor into the decision making process? >> the first goal the we have is to meet our mandate to get price stability and maximum employment. a strong u.s. economy is critical for the global recovery. in that respect, it is very important that we do achieve a successful recovery in the u.s. with respect -- in the u.s. with respect to the dollar, that is where the fundamentals come from. we are certainly aware that the dollar does play a special role in the global economy in the international financial markets. there must be someone else with a question. there we go. >> mr. chairman, i am curious how you think the results of the midterm elections will affect fiscal and monetary policy in the next six months. >> the federal reserve is totally non-partisan. we work with both parties. we work with the administration and the congress. we do not make political predictions. our basic goal is to do what we can to support the economy, to create employment opportunities and price stability. we want to work with the administration to get as much help and the policy and growth as we can for the rest of the government. we are nonpartisan. we were equally with all members of congress and the administration. >> my question is not on the second round a quantitative easing. i want to know about what you are facing. when he bailed out aig, you are facing opposition. -- when he bailed out aig, you were facing opposition. why did you did it? what is your reaction? >> we took the action. i do not know where you get the idea that our advisers were against it. they were not. you know, when the lessons i've learned -- before i became chairman, alan is a professor. one of my major interest was economic history. i read a lot on the great depression. i took to lessons from the great depression. one is that monetary policy needs to be supportive of the economy. it was incredibly tight in the 1930's. the the other lesson was that broad based financial crisis is destructive to the broader economy. this has been learned over and over again in many other contexts. it is important to try to prevent a systemically important and critically interconnected firm from collapsing in the middle of a broad panic me. the whole system was under a lot of pressure. we are doing our best to prevent a disorderly collapse of a financial firm. there is no doubt in our mind that we needed to do what we could. the tools were very limited. a very important development in the newdodd/frank reform -- dodd/frank reform will let us do it in a way it did not leave this in that kind of situation. that is critically important. in 2008, we did not have such tools. it applied only to banks and not aig or other non-banking firms. we did not have good tools. the only till we had -- tool we had was to lend money. aig was facing a run. catches flowing out. cash was flowing out -- cash was flowing out. to stop that you wind against capital. this is one of the largest insurance companies that had attached to it in one relatively small division that was making very dangerous that the bill -- dangerous bets. it was an ongoing viable enterprise. the company itself the become collateral for a loan. we wish we have the act in place at that time. we knew that if the company collapsed on top of the lehman collapse that very likely the financial system would collapse. then we would have faced a much worse economic situation. we did it because we knew if we let the company collapsed that the danger to the world economy was an enormous. we did it. that is unwinding. the federal reserve will get that loan repaid. we succeeded in avoiding the financial meltdown. it is somewhat of an unpleasant experience. you asked about the bonus issue. it was a bad judgment on the part of the management. when i learned about that, there is legal action we could take. i was told there was not. it is a relatively small amounts of money. it created a lot of resentment and anger among the public. that is understandable. in that respect, it was a bad event. after that happened, the treasury began to formalize its management and compensation for other companies that have received help. that has not been the fed's problem for quite some time. >> hello. how do you think the high level of growth in china will affect the future? how will it affect the fed policy in the future? >> emerging-market are growing very quickly. that has a number of attacks. one is that it raises commodity prices. that is an issue. it serves as an engine of growth in demand for the global economy. having growth in emerging market is basically a good thing. at a fundamental level, 20 years ago we were talking about developing countries and billions of people in serious poverty. it is brought many people from abject poverty into a decent living standard. in that respect, it is very positive. more generally, it is good for the global economy. another country does well it does not mean we are worse off. the better global economy, the better opportunities we have to trade and invest. there are a lot of issues. a well functioning chinese economy is good for the united states. if it strengthens, we take that into account. our focus is under development in the united states. this factors and to our analysis this is how we make -- analysis. this is how we make our policy decisions. >> i was wondering how the new legislation will in fact how the fed deals with acid bubble's going forward? >> there is a very important philosophical change in our regulatory system. prior to the legislation, individual agencies focused on just those market for which they were responsible. the banking industry's but at the banks. the trading commission looked at the changes. insurance regulators look to the insurance companies. there are a couple problems with that approach that became evident. the consistency of regulation as very and even. while some -- uneven. some were falling between the cracks. this is a much broader and bent been a single institution prevent it requires great complex interaction. there is nobody looking at the system as a whole. subprime mortgages were a problem for a wide variety of institutions. they are looking at it for a system wide perspective. a very important element for dodd/frank is to create a macro prudential approach. it is try to look at the system as a whole. there a number of ways that can happen. when it the most basic is that the legislation creates a new council. it will have the major agencies including the fed and treasury. it will meet regularly and tried to talk to each other and identify the problems like a housing bubble. by comparing notes and working together, we should be better able to identify the problems. we cannot guarantee that we can see everything that will happen. it is very important that legislation takes a lot of steps to strengthen the system. i mentioned the basel capital rules. . . d approach. the federal reserve is doing is within our own appach to the get the system as a whole and identify risks that are emerging. on the other side we want to do erything we can to strengthen the system so it can withstand better than it did the past few years. >> university of north florida. my question is about your 2002 speech and making sure deflation does not happen here. you stated japan's economy faced >> my question is about the 2002 speech. you stated that japan's economy . in a policy makers reluctant to use fiscal policy. he felt the u.s. did not share the problems. do you still kill the way? -- feel that way? >> i think japan has a number of strengths. it is still a very rich economy. one of the main problems that japan has is demographics. japan is getting older. to the extenit has worked for us and is on the brink of shrinking. that is one major problem that japan has the we do not have. it is close now, on the that et by the fact the zero most of their own debt. in the u.s., the ratio of debt to gdp is much less thahas been rising produced the get me. in addition, we have some long- term issues that we need to address. i'm glad you read my speeches. i am impressed. recently, i've given some testimonies that address the need that we have. i think everyone understands that we need to do with our alarm term fiscal iues. we are not yet to the 200% level. we need to take action t bring our long-term fiscal and balances into better alignment. otherwise, it could lead to very severe problems. >> thank you give as yet seen the commodity prices rise, it seems a lot of people move into gold because of fears of possible over inflation. it seems a lot of these investors still quantitative easing may be too over inflation. is there anything to minimize this over inflation? >> absolutely. we are absolutely committed to keeping inflation low and stable. we have the tools and wind and tighten -- and unwind as the time comes. there is the question that we will be able to manage that. it is important to undstand that inflation expectations remain really quite low. one example would be the inflation rate evens, the different between the yield on regular nominal treasury bond and inflation indexed bonds. it is an indication of the amount of inflation that investors expect over the next five or 10 years. that is still below 2%. investors think that inflation will stay low. if you look at the surveys for consumers and businesses, you do not see any contradictions. with a pet owners to try to predicted overlong times -- we also look at business owners who try to predict it over a long amount o time. if that in both directions. they also protect against further declining inflation it is important for the fed to keep inflation expectaons will anchored in stable. i think a are stable. we will work to keep them there. >> good afternoon. my question regards the housing market. what kind of timeline to you think the united states is looking at in order for the housing market to recover where property owners and start to see some appreciation in the property? >> that is very difficult to know. right now, construction is basically lower than any time since world war ii, even during times of our population is lower than it is today. we have a growing population. we have households being formed. you would expect to see house prices normalizing. the problem is that we still have some steps to go before we get there. we still have a lot of foreclosures in the process. that takes time for the market to adjust to that. when you have a lot of foreclosed homes, that makes it more difficult for new construction to be marketed. we do have some important problems before we can get out of the current proems in the housing market. eventually, we will. we have to. our population is growing but from natural increase and immigration and the 1e places for people to be housed. >> i know we want this session to keep going on and on. we have to put an end to this. i am sure everyone agrees with me that this class is so special. it is a wonderful opportunity and experience for all of us. let's think chairman bernanke for coming over here and being with us. [applause] >> now, president obama on the october unemployment numbers. the labor department reports the biggest increase in private sector jobs with the highest in education and health care. but a separate survey reports the unemployment rate remains at 9.6%, the same as in august and september. we are in a tough fight so businesses can open and expand, so people can find good jobs, and so that we can repair the terrible damage that was done by the worst recession in our lifetimes. today we received some encouraging news. based on today's jobs report, we have now seen private sector job growth for ten straight months. that means that, since january, the private sector has added 1.1 million jobs. let me repeat. over the course of last several months we have seen over 1 million jobs added to the american economy. in october, the private sector has added 159,000 jobs. we learned that businesses added more than 100,000 jobs in both august and september as well. so we've now seen four months of private sector job growth above 100,000, which is the first time we've seen this kind of increase in over four years. now, that's not good enough. unemployment rate is still unacceptably high and we've got a lot of work to do. this recession caused a great deal of hardship and put millions of people out of work. so in order to repair this damage, in order to create the jobs to meet the large need, we need to accelerate our economic growth so that we are producing jobs at a faster pace. because the fact is, an encouraging jobs report doesn't make a difference if we're still one of the millions of people who are looking for work, and i won't be satisfied until everybody who is looking for a job can find one. so we've got to keep fighting for every job, for every new business, for every opportunity to get this economy moving. and just as we passed a small business jobs bill based on ideas of both parties in the private sector, i am open to any idea, any proposal, any way we can get the economy going faster so that people who need work can find it faster. this includes tax breaks for small businesses, like defering taxes on new equipment so that they've got an incentive to expand and hire, as well as tax cuts to make it cheaper for entrepreneurs to start companies. this includes building new infrastructure and high-speed trains to high-speed internet so that our economy can run faster and smarter. it includes promoting research and innovation, and creating incentives in growth sectors like clean energy economy. it certainly includes keeping tax rates low for middle class families and extending unemployment benefits to help those hardest hit by the downturn while generating more demand in the economy. it's also absolutely clear that one of the keys to creating jobs is to open markets to american goods made by american workers. our prosperity depends not just on consuming things but also on being the maker of things. in fact, for every $1 billion we increase in exports, thousands of jobs are supported here at home. and that's why i've set a goal of doubling the experts. that's why on the trip i'm about to take i'm going to be talking about opening up additional markets in places like india so that american businesses can sell more products abroad in order to create more jobs here at home. this is a reminder as well that the most important competition we face in this new cently will not be between democrats and republicans. it's the competition with countries around the world to lead the global economy. our success or failure in this race will depend on whether we can come together as a nation. the future depends on putting politics aside to solve problems. to worry about the next generation instead of the next election. we can't spend the next two years mired in gridlock. other countries like china aren't standing still, so we cabinet stand still either. we've got to move forward. if we can do that, if we can work together, then this country will not only recover but we will prosper. and i'm looking very much forward to helping to pry some markets op and help american businesses and put people back to work here at home during the course of this travel. thank you very much. >> next, live, your calls and comments on "washington journal." next, u.n. development program, then followed by attempts to stop corruption in iraq. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] host: a chance to seek new markets for u.s. goods. officials in alaska will start counting write-in ballots.