Bernanke takes Fed message on the road, speaks to soldiers in El Paso
Federal Reserve Chairman Ben Bernanke took the Fed's message off the beaten path Thursday by speaking directly to a group of soldiers at Fort Bliss in El Paso,Texas, on the benefits of financial literacy. The event captured headlines, with analysts describing Bernanke's visit as eerily similar to a political speech for the Fed as opposed to a typical update on monetary policy. Bernanke's willingness to visit Texas — an area where the Fed has been heavily criticized — comes at a time when the Fed chief is beginning to publicly highlight the need for Congress, or the nation's political branch, to do more to stimulate jobs growth and economic stability. Bernanke used the opportunity to assure servicemembers that the Fed is doing what it can to get the economy going for average Americans. He also addressed the European debt crisis, saying it could impact financial markets worldwide. The Fed chair told the crowd a number of countries in Europe cannot meet their debt obligations and the problem lies in the fact that "there is no single fiscal authority that can help them out." The main purpose of the Bernanke visit was to highlight financial literacy programs that are already active in the military and to assure soldiers that the Fed is already focused on stabilizing the economy for Americans. Bernanke also highlighted the work of the Consumer Financial Protection Bureau, which has a division run by General Petraeus' wife, Holly Petraeus, to protect the financial interests of military members who borrow money. "Your hometowns may be struggling with foreclosures. You may have had difficulty getting a loan to buy a car or a house. You may have family members who have had trouble finding employment in a tough job market. You may be worried about your own job prospects when the time comes for you to leave the military. So this morning I thought I'd first say a few words about what the Federal Reserve is doing to help strengthen our economy and increase economic opportunity," Bernanke said. Bernanke, who has come under great criticism for employing sustained expansionary monetary policies, said Thursday that the "high unemployment rate is why the Federal Reserve is focusing its monetary policy at strengthening the recovery and job creation, including keeping short-term interest rates near zero and longer-term rates, such as mortgage rates, at their lowest levels in decades." Bernanke told the crowd that the Fed put downward pressure on longer-term interest rates through the purchase of high quality, longer-term securities in the open market. This effort has focused greatly on the purchase of federally backed mortgage securities. "It is important to understand that this type of activity isn't the same as government spending," Bernanke said. "We will sell the securities back into the market or simply allow them to mature as part of the process of tightening monetary policy when the economy improves. In the meantime, we earn interest on the securities we hold." The Fed chair said the reserve returned $125 billion in interest earnings to the Treasury last year and the year before. Write to Kerri Panchuk.