Bernacke says Banks are Improving

Looks like this week is starting out on the right foot, and the light at the end of the tunnel continues to try and peak through... just as I blogged about last week in Each Day is a Bit Brighter.

This weekend Federal Reserve Chairman Ben Bernanke had his first televised interview giving an optimistic viewpoint on CBS's "60 Minutes", saying “The biggest risk is that, you know, we don’t have the political will. Recovery is not going to happen until the financial markets and the banks are stabilized,” and the government’s plan is “going to take some patience. It’s going to take some support,” Bernacke said.

Spring is in the air... Green Shoots are Sprouting.

Bernanke reiterated in the interview that, should the government succeed in calming financial markets, the recession will probably end this year and the economy will expand in 2010. “Green shoots” are appearing in some markets aided by the Fed, and there has been “some improvement” in banks, he said.

Bernanke, 55, didn’t offer new details on financial-rescue programs or economic forecasts. The television show, including footage of the Fed chief visiting the rural South Carolina town where he grew up, gave Bernanke an opportunity to make the case he understands the anxieties of ordinary Americans.

“I come from Main Street,” Bernanke said near the building where his father owned a pharmacy in Dillon, South Carolina. “I care about Wall Street for one reason and one reason only -- because what happens on Wall Street matters to Main Street,” Bernanke said. “And if we don’t have stabilization in the financial markets, if we don’t take the steps necessary to make sure that credit is flowing again, then my father couldn’t get a loan to build his new store.”

Thank Goodness Bernanke "Gets it".

Bernanke said the October law creating the TARP prevented a possible “global financial meltdown” and that he told a skeptical congressman at the time that businesses in his district would begin suffering losses without decisive congressional action. He didn’t identify the lawmaker.

“We’ve averted” the risk of a depression, Bernanke said. “Now the problem is to get the thing working properly again.” While the largest U.S. banks are “solvent,” Bernanke reiterated that the government’s so-called stress tests will determine how much more capital each bank will need to be “well capitalized” in tougher times. One sign of a recovery would be success by a large bank in raising private capital, he said.

I really like this Fed Chief...

He elaborated on comments earlier this month that the bailout of AIG made him angrier than any other incident during the financial crisis, saying he “slammed the phone more than a few times on discussing AIG.” “It’s absolutely unfair that taxpayer dollars are going to prop up a company that made these terrible bets,” Bernanke said. Yet failing to rescue the company would “risk enormous impact, not just in the financial system, but on the whole U.S. economy,” he said. Bernanke said “the era of this high living” is over for bankers and that banks must “find a way to make loans to creditworthy borrowers” now.

CBS billed the segment as the first broadcast interview with a sitting Fed chief in 20 years. “It’s an extraordinary time. This is a chance for me, I think, to talk to -- to America directly" said Bernacke.

So far the overseas markets and US futures are liking what they heard. I'm looking forward to this week... especially my chance to talk to you, my Foreclosures.com clients, about how to succeed as a foreclosure investor, in this once in a lifetime market.

There are so many people who need our help, as well as banks who need to unload their foreclosure inventory... but we need to get out there and make contact. That means, making calls to strangers and asking the right questions to really qualify your prospective motivated sellers. And I will show you "what to say and how to say it", when talking to owners and REO lenders and their agents... about buying their properties for wholesale prices... this Tuesday, March 17th at 6pm Pacific. Make sure you register early, as I do fill up!