US Federal Reserve Chairman Ben Bernanke said Tuesday that if measures are taken properly, the current recession will end in 2009 and 2010 will be a year of recovery.
In testimony prepared for the Senate Banking Committee, Bernanke warned that the U.S. economy is undergoing "a severe contraction."
Bernanke stressed that it is essential that regulators "continue to implement fiscal stimulus with strong government action to stabilize financial institutions and financial markets."
"If actions taken by the Administration, the Congress, and the Federal Reserve are successful in restoring some measure of financial stability -- and only if that is the case, in my view --there is a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery," he said.
The U.S. central bank chief also talked about the cause of the crisis.
"The principal cause of the economic slowdown was the collapse of the global credit boom and the ensuing financial crisis, which has affected asset values, credit conditions, and consumer and business confidence around the world," he said.
"The immediate trigger of the crisis was the end of housing booms in the United States and other countries and associated problems in mortgage markets, notably the collapse of the U.S. subprime mortgage market," he said.
(Xinhua News Agency February 25, 2009)
