are you standing by that or are you changing things now that you've heard from bernanke? >> susie, we are standing by that. for a couple of years, for more than two years we have been more constructive and we had been operating with a higher equity portion and a slower cash and slower fixed income for bond portion. but we think that's the best part of the bull market of the last couple years is behind us and we felt it was a good time to take some profits, we don't need to be heros, and then to have a still very diversified portfolio. but one that is designed such that if we hit the bumps in the road they will not be very much. >> susie: let's say the fed does take some action over the next couple months. what's your call on the dow and the s&p 500 over the next six months? >> we think it's going to be a very challenging environment. that's the reason why we made some of the changes that we did, between now and the last time that the fed actually met. we think also that their policy challenges on the other side of the atlantic ocean. so we want to remain this way until we

announced this week by the hair man of the board, ben bernanke. the fed as it's called released its projections for 2011, the bad news -- item, gdp, gross domestic product, all goods and services down from 3% projected growth for 2011 to 1.6% projected growth for 2011. item, unemployment up, from below 9% projected for this year to 9.1% now projected for this year. item, long-term unemployment up. currently unemployed will remain unemployed after the economy recovers. >> cyclical unemployment left untreated for a long time can become structural unemployment as people lose skills, attachment to the labor force, as their work networks dry up. >> last week, the u.s. secretary of the treasury, tim geithner, echoed chairman bernanke's overall assessment. >> it's still very tough out there. the people are very frustrated and still hurting growing fast enough. >> the u.s. unemployment rate came in late this week. it at 9% or higher. question, are policymakers around the world starting to fear that they don't know how to restore the economy that existed i

. >> reporter: ben bernanke admitted the numbers were weak. he said economic growth did strengthen somewhat in the third quarter. at the same time, the fed chairman said, the long-term outlook for the economy is getting worse. the fed sharply cut its forecast for growth this year. in june it projected 2.8%. its new forecast is more than a full point lower. and it cut the outlook for next year, too, from 3.5% growth to a much slower 2.7, which economists say is not enough to spur significant job growth. >> in sthort, while we still expect that economic activity and the market conditions will improve gradually over time, the pace of progress is likely to be frustratingly slow. >> reporter: that's especially true with the unemployment rate. thousands lined up in coconut creek, florida, today for a chance at 800 new jobs at a casino there. after earlier predicting that the jobless rate would fall to 8% next year, the fed now expects it will remain above 8.5% through the end of 2012. but bernanke says the federal reserve isn't out of ammunition. >>

. >> even ben bernanke said if things worsen in europe, it will ultimately have an impact on the u.s. economy. so mike, what about that? the federal reserve met this week and they took their expectations for growth down, they took their expectations for unemployment up. did any of this surprise you? >> i think they're maintaining flexibility. there is a lot of talk of qe-3 or something like that, potential stimulus, we're coming into an election year. there will be a lot of pressure applied for stimulation in the economy. no, i wasn't surprised at all. i think it maintains flexibility for the fed. my view is i don't think what the fed is going to do will have any incremental impact. i think the law of diminishing returns comes into play here and it's more of a fiscal play here, and if anything, the fed is trying to cover up for the lack of our fiscal leadership to get anything done with any real stimulus. >> you make a point, because one thing bernanke said was we've done what we should be doing, now we need leadership, and i think he was suggesting he wants government, he wants the a

bernanke tomorrow? >> that he was resigning. ( laughter and applause ) that he's going to throw in the towel and say, "i'm very sorry, keyseian economics and price controls on money really don't work and everything we've done in the past couple of years really hasn't solved our problems." >> tom: one of the two mandates the federal reserve is required to work toward is full employment. about half of unemployed americans have gone at least six months without a job, a record number of long term unemployed. former house speaker newt gingrich wants to use that time to retrain american workers. >> and you say, "if you need unemployment compensation fine, then you have to sign up for a business-offered job training program." if you had 99 weeks of unemployment, that's an associates degree. in 99 weeks, you can train virtually anybody. you establish the principle "we do not give people money for doing nothing." >> tom: while election day is one year away still, caucuses here in iowa are held in just two months

markets apparently like what ben bernanke had to say moments ago. >>> new flare ups involving occupy wall street a disturbing new revelation about gun us in airport luggage. a russian arms dealer learns his fate today and an american flight attendant found dead in mexico. time to play reporter roulette times five on this wednesday. alison kosik at the stock exchange, looks like the market like what is it heard from fed chief ben bernanke. >> you are right about that, but the rally began before bernanke started talking this is a bounce back from the past two days. the past two days, the dow fell 600 points between monday and tuesday. that is why we see the dow up 162 points. as far as the fed goes, you know what, it really didn't go outside the box today no big surprises, it kept the key interest rate near zero, although what it did didn't dial back the overall projection how much the u.s. economy is going to grow, but that's what's key here, the fed thinks the economy is going to grow but a much smaller pace forecast this year, but not the best news but not surprising either, nothing

and i think the government knows, i think that bernanke knows this that they want inflation, certainly paul krugman argues the case they want inflation and reduce the standard of living without saying you have a nominal cut, but this has been around for a long time and that's how you cut real wages when wages have to come down because nobody would accept a nom mal cut. nobody going to accept this. their problem is the usual tools of spending and printing money hasn't worked for them, because the debt is so big, and just continue to do this just makes our problems that much worse and what i've always worried about, this would lead to political turmoil and that's what we're witnessing today and that will be worldwide, but-- >> i take it from what you're saying, congressman, you certainly, if you became president of the united states, would not be adding american money through to the imf and the national lender and the world bank for that matter and we are of course the biggest contributor to both and when it came to bailing out a country, be it italy or greece, you would say no? >> i wou

. >> david, treasury secretary tim geithner and the counterfeiter in chief ben bernanke borrowed so much they have increased it to 3.9 percent over the last. this kills earnings for seniors and people with fixed income. and the increase is basically zero . so why the president is waging war against the seniors and destroy their living standards, i have no idea. >> president and ben bernanke counterfeiter in chief, would you use that praise. >> it is an exgagation. it is in the fed's interest to have inflation to get out of the asset-debt problem and engineering it to some degree. it is uneven . david you mentioned toll prices and gas prices. >> and government's prices go up. >> and gas prices are because we are importing gas. over all. we are not seeing inflation or wages and in housing. you have a lot of slack in the system. >> you can't do without it like food and like gas. i mean, these are things that you can't afford. -- avoid. >> it is a problem of money supply and why the federal reserve knocks out food and energy. and i got to say you got to eat food. >> it is showing up and boom

ben bernanke left open the possibility of acting if conditions here or in europe worsen. the fed forecast growth over the next two years, but bernanke cautioned the pace will be frustratingly slow. european leaders vented outrage at greek prime minister papandreou at a meeting in france after his call for a freak referendum through europe's debt plan into chaos. german and french leaders and papandreou describe the vote as greece's decision whether for greek to remain part of europe. >>> here at home, an october jump in private hiring also lifted stocks. banks led by bank of america recovered from recent losses. in earnings, mastercard hit its all-time high on soaring ea earnings. news corps fell. kraft rose late after a surge in profit. the opening price will be set today for groupon's much anticipated ipo. 30 million shares begin trading tomorrow. >>> a regulator says now bankrupt mf global moved millions in missing client funds last week trying to avoid detection. despite assurances from the firm's lawyer, all the client money is accounted for. reports say roughly $600

but i'm curious, what's wrong with ben bernanke?u think he should be fired and speaker inting gingrich thinks so? >> well, he allowed himself to be politicize by this administration, by -- with these infusions of money and to the monetary supply that has really gotten out of hand. in 1988, greta, it took $1.20 of canadian money to buy $1. today ttakes $1.20 u.s. to buy $1 canadian. this is upside down in terms of the value of our currency. and quite frankly, his decisions has helped lead to that. the reason he did that, i am conjecturing, is because of the $14 trillion debt. when foreigners are not standing in line to buy our debt, then the federal reserve flees trying to prop up the treasury. that's the problem that i have and speaker gingrich has with some of the decisions he has made. >> lyou know, it brings up the question of currency, something that i think that government romney said he would name china i think, the currency cheater and governor huntsman disagreed with him on that. but the idea of how we value our currency. it

. >>> fed chair ben bernanke warned wednesday that the u.s. economy remains dangerously weak.ly cut its forecast for growth. in june, it projected 2.8% growth. its new forecast is more than a full point lower. the fed also cut the outlook for next year from 3.5% growth to a much slower 2.7%. economists say that is not enough to spur significant job growth. bernanke says he also expects unemployment to remain above 8.5% through the end of 2012. >>> happy birthday chevy. the brand is as american as apple pie marks its 100th anniversary today. it is the top selling car brand of all time, though, it's hit some rough patches along the way. most recently when parent company general motors needed a federal bailout to survive. more than 4 million chevys were sold last year. that is half of gm's total sales. >>> there was one winning ticket in last night's $245 million powerball jackpot and it wasn't me or i wouldn't be here. the ticket was sold in connecticut and the winning numbers were 12, 14, 34, 39, 46, and powerball 36. i didn't even have a ticket to play! >> it just makes me so

that, according to the federal reserve chief, ben bernanke. the fed reduced its forecast for the next two years, saying it had overestimated the nation's recovery. bernanke says the central bank is pushing hard to produce growth and create jobs. >>> sims, which also owns filene's basement, has filed for bankruptcy. and will close its doors by the end of the year. the company cites the sluggish economy and competition from online retailers. >>> and a group of bipartisan senators has announced a plan to save the cash-strapped postal service. among the proposals, eliminating saturday mail delivery within two years. and an idea to offer wine and beer delivery to boost revenues. >>> and we've been driving the chevy to the levy for 100 years. chevrolet, the iconic general motors brand celebrates its 100th birthday today, with 60% off sales outside of the u.s. chevy is on the road to its best year yet. >>> this morning apple is acknowledging some owners of the new iphone 4s, is experiencing probleming with its battery. apple will release software in

now federal reserve chairman ben bernanke talks to u.s. soldiers about the economy and the importance of financial literacy for veterans. ben bernanke was at fort bliss in texas. this is about an hour. >> we have a treat this morning. a unique opportunity to engage with and talk with the chairman of the board of governors of our federal reserve system. unbelievable. and this is actually his first visit to a military installation since becoming the chairman of the federal reserve. but we also think, and looking back in history, that since the federal reserve act this may be the first time and chairman of the federal reserve bank has come to a military installation to engage with soldiers and families. and we know his job is pretty tough. this economy of ours is a tough economy. and so i know we will have a lot of questions that have to do with the economy and other things of concern. but a little bit about ben bernanke. he is from south carolina, a small town in south carolina. he went to harvard, got his ph.d. at mit, was an economics prof

you know, bernanke says there are still more tools in the fed's tool box that they can use. >> bret:hich the market liked today. >> liked today, yes. we don't know exactly what they are. i think what is happening in europe will be a huge, huge drag as bernanke said today. >> what about the g-20 trip and the prospect of this greek deal? go in to a referendum to approve the euro zone debt deal, which didn't, wasn't really optimistic sign for the european leaders. >> what happened is last week it looked as if the european had finally come to an agreement on how to bail out the greek, including a discounting their bonds by half. so a few invented in the bond utilizes half of the money. which appeared to be something that might work. not 100% sure. all of a sudden, the greek prime minister announces on monday shocks the europeans. the detrail of that a -- betrayal of that agreement. he says i'll put it up to a referendum. the chances are, it may not succeed and it may end up defeated. the government might actually fall. >> bret: let me interrupt you. the greeks just put out an alert that

federal reserve chairman, ben bernanke, hinted that the central bank may again step in on the nation's economy. but he stopped short of saying what exactly that would take. the remarks followed a dismal economic outlook from the federal reserve, which forecast high unemployment for several years, around 8.6% at the end of next year, and hovering near 7% deep into 2014. it cut growth targets for 2012, to 2.5 to 2.9%. down from june estimates of over 3%. he added that concerning of europe are weighing on global markets and hurting confidence and there ro rts this morning that greece's prime minister has called for an emergency cabinet meeting today. as one lawmaker says, the leader is quote history. toor all of these developments, we bring in cnbc's ross westgate live in london. what's the latest? >> well, willie, first of all not much reaction to the staying on sidelines waiting to see how operation twist fared out which they enacted in the last meeting. if anything the statement a little more upbeat. a couple of months ago there were big fears that the u.s. were sliding into recession.

the fed forecast growth over the next two years, but bernanke cautioned the pace will be frustratinglylow. >>> meanwhile, european leaders vented outrage at greek prime minister, george papandreau at a meeting in france, after his call for a greek referendum threw europe's debt plan into chaos. german and french leaders, as well as papandreau himself now describe the vote as greece's decision on whether to remain part of europe. a revolt in papandreau's own government may kill the referendum after a confidence vote tomorrow. >>> back at home, an october jump in private hiring also lifted stocks. banks led by bank of america recovered from recent losses. >>> in earnings, mastercard hit its all-time high on soaring earnings, news corp.'s net income fell on costs related to its phone-hacking scandal. kraft rose late on a surge in profit. the opening price will be set today for groupon's much-anticipated ipo, 30 million shares begin trading tomorrow mplgt. >>> a regulator says now-bankrupt mf global moved millions in missing client funds last week, trying to avoid detection. despite assura

>> i mean, come on, i want ben bernanke to go grocery shopping with me, come on, there is inflation outre. everybody at home knows it. you dig down into these numbers and what you find, airline tickets up 10%, apparel up 4%, food is up 5% and at thanksgiving this year, going to be paying 13% more for your dinner which is why, neil, i was hoping i might score an invitation. >> neil: i was trying to go the other way around with you. you know, it is interesting. i mean, don't worry about inflation right now. interest rates are really, really low. they're going to stay really, really low. everyone almost in lock step on that and then as gerry points out, you see these stubborn rises in all this other stuff. >> when you say everyone, you're talking about people who want to see the stock market manipulate higher and wants to see the government find a way to pay off their bills. they're not talking about savers, not talking about renters and listen, to gerry's point, in new jersey it costs twice as much to go across the bridge than it used to cost. life is so much more expensive than it has be

ben bernanke has the authority to buy the debt of foreign governments. fed has said they won't use this power to bail out foreign governments, that they would only purchase highly rated foreign government debt. as of tonight that means they can buy the debt of germany, france and britain. they're all highly rated. the u.s. treasury could be out there buying bonds to keep europe from crashing. we called the fed and didn't get a comment tonight. by the way, for those of you keeping scoring, the batch downgrade included two banks that's got upgraded. both are chinese. >>> "outfront," the "outfront" five facebook getting ready for $100 billion ipo? >>> and speaking of privacy, we can't resist telling you all about something -- we're not supposed to talk about. but my n. [ male announcer ] truth is, dayquil doesn't treat that. really? [ male announcer ] alka-seltzer plus fights your worst cold symptoms, plus it relieves your runny nose. [ deep breath] awesome. [ male announcer ] yes, it is. that's the cold truth! it's a melt in your mouth kind of experience.

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