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Thursday, September 08, 2005

Bernanke on the Short-Run and Long-Run Economic Effects of Katrina

Ben Bernanke, chairman of the White House's Council of Economic Advisers, discusses the economic consequences of Hurricane Katrina.  From Bloomberg:

Bernanke Says Katrina to Have 'Palpable' Impact on U.S. Economy, Bloomberg:  The U.S. economy will suffer short- term setbacks in the aftermath of Hurricane Katrina, although growth may rebound next year as rebuilding accelerates, said Ben Bernanke, chairman of the White House's Council of Economic Advisers. ''In the shorter term, the devastation wrought by hurricane Katrina will have a palpable effect on the national economy,'' Bernanke said … ''The virtual shutting-down of the Gulf Coast economy will leave its imprint on the national rates of job creation and output growth in the third and fourth quarters, while recovery and rebuilding should increase growth rates in the first half of next year,'' he said. … Bernanke said energy prices may begin to moderate. ''Near- horizon futures prices for gasoline have already begun to moderate, and retail prices should follow them down very soon,'' he said… ''Thus far at least, the growth effects of energy price increases appear relatively modest.''

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