What happened since we left you, Fellow Reckoner? Ah, yes. The Fed concluded its back-slapping fête in Jackson Hole on Friday, with The Bernank going way out on a thin limb:

"Bernanke Bets New Economy Is Same as Old One," was how one paper put it.

The world's most powerful central banker is facing growing concern that persistently high US unemployment - officially at 8.3% - is due to "structural shifts in the economy wrought by the financial crisis." Critics of his policies "contend joblessness is permanently elevated."

Bernanke responded as one might expect someone in his position to respond. "I see little evidence of substantial structural change in recent years," he said, arguing for "more of the same."

"The costs of non-traditional policies, when considered carefully, appear manageable, implying that we should not rule out the further use of such policies if economic conditions warrant," waffled Bernanke. "Over the past five years, the Federal Reserve has acted to support economic growth and foster job creation, and it is important to achieve further progress, particularly in the labor market."

"In other words," wrote Dave Gonigam in Friday's edition of The 5 Minute Forecast, "he's ready to once again sacrifice savers on the altar of 'quantitative easing'... but not just yet."

Surely Fellow Reckoners will agree, achieving "further" progress implies having achieved some progress in the first place.

Bernanke & Co. have used all manner of tools to pin interest rates to the floor since the crisis began, mushrooming the Fed's balance sheet over $2 trillion in the past three years alone. Where is this "growth" of which Bernanke speaks? Where is the job creation? Where is the progress?

According to the Fed's own tortured figures, the US economy continues to merely sputter along, growing at just 2% annually, barely enough to keep its head from slipping under the waves.

US Unemployment levels, too, are largely unchanged. Some 13 million Americans still find themselves unemployed...a figure which does not take into account a few conveniently-dismissed groups. "Involuntary part-time workers," as the Feds categorize them, totaled 8.2 million for the month of July. "Marginally attached" workers numbered another 2.5 million.

"They were not counted as unemployed," explained the Employment Situation Summary from the Bureau of Labor Statistics, "because they had not searched for work in the 4 weeks preceding the survey." Hmm...guess they don't count, then, eh?

The number of long-term unemployed (those jobless for 27 weeks and over) was little changed for the month of July at 5.2 million. This group now accounts for over 40% of the total unemployed.

Of course, the Feds don't measure success the same way that, say, an honest (or even dishonest!) individual might.

Regards,

Joel Bowman
for The Daily Reckoning Australia