Bernanke Backs Quick Bailout

The country needs a federal stimulus package ASAP, Federal Reserve Chairman Ben Bernanke told the House Budget Committee today, advocating immediate legislation designed “so its effects on aggregate spending are felt as much as possible within the next 12 months.” But he said the package should be “explicitly temporary,” to avoid unwanted long-term stimulus and an undue deficit bulge, CNNMoney reports.

Committee Chair John Spratt promised to heed the deficit warning, but maintained that something must be done now, echoing economists who believe a slump is already here. Another congressman voiced inflation fears, and Bernanke promised vigilance, but said he expected it to be moderate this year. Most believe Bernanke intends to cut rates by half a point at the Fed's Jan. 30 meeting. (More Ben Bernanke stories.)