In separate speeches both President Obama and Federal Reserve chairman Ben Bernanke gave assessments of the nation's economic health. The venues may have been different, but their views are essentially the same: the economy is starting to show tiny signs of recovery, but the road back to prosperity is still a long one. In a speech to students and faculty at Georgetown University, President Obama said, "we are beginning to see glimmers of hope." According to the Associated Press, Obama stressed that America still has a long way to go on the road to economic recovery. The president credited his bold economic agenda for putting the country on the right path. Unfortunately, the numbers that came out this week weren't helping Obama make his case. The AP reports that March had a drop in retail sales, as well as sharp declines in both wholesale and energy prices. The specter of both inflation and deflation hang in the shadows. After a five week rally, the stock market reacted negatively to this news. Analysts don't seem to think this week's dip is a sign of bad things to come. In fact, Goldman Sachs reported far better than expected earnings. The company hopes to raise $5 billion in stock to begin repaying the $10 billion loan from the government last year. Making Biblical references, Obama took the opportunity to stress the importance of rebuilding the American economy in a new way. "We cannot rebuild this economy on the same pile of sand," he said. "We must build our house upon a rock. We must lay a new foundation for growth and prosperity a foundation that will move us from an era of borrow and spend to one where we save and invest, where we consume less at home and send more exports abroad." The president cited changes in financial regulations and more focus on clean energy and education as some of the initiatives his administration is taking to change America's economic landscape. In a speech at Morehouse College in Atlanta, Bernanke pointed to recent signs of improvement in home and auto sales, home building and consumer spending. However, he was willing only to call these indicators "tentative signs" of recovery. Bernanke's main focus seemed to be to stress the importance of stabilizing the financial markets, and in particular the Fed's efforts in that area. Those efforts have called for unprecedented amounts of money to be pumped into the system to lower interest rates and get credit flowing again. Obama also defended the government's expensive efforts to help the banking industry. "The truth is that a dollar of capital in a bank can actually result in eight or ten dollars of loans to families and businesses, a multiplier effect that can ultimately lead to a faster pace of economic growth," Obama said. The road to recovery still looks bumpy, but Obama and Bernanke say the view on the horizon is going to be better in many ways. And Texas may be on the forefront of that changing economic landscape, as sectors such as construction and retail shrink but energy and education continue to grow.
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