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MORE HELP, PLEASE: The Fed chairman also called on other parts of the government for help with the economy: "Monetary policy by itself is not going to solve our economic problems. We welcome help and support from any other part of the government. ... So collaboration would be great." HOW THE FED HELPS THE ECONOMY: In addition to keeping interest rates low, Bernanke said the Fed's policies encourage investors to sell Treasury bonds, which pay little interest, and buy other assets, such as corporate bonds: "The effect will be to lower corporate bond rates." And if companies can borrow at lower rates, "then they're more likely to expand, to add ... products, and consequently, they're more likely to hire." HOW THE FED HELPS THE PUBLIC: "Many Americans are able to take advantage of lower interest rates. Many people have refinanced or bought homes. Others have taken out loans to buy cars. Auto loans are cheap and broadly available." WHY THE RECOVERY IS WEAK: Bernanke cited three factors holding back growth: Europe's financial crisis, which is reducing U.S. exports and overseas sales by U.S. companies; the persistent weakness in the housing market; and spending cuts and layoffs by state and local governments. "Put them all together, and you have an economy which is growing less quickly than it normally would following a recession of the magnitude that we saw."
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