Economy Will Suffer From Housing Slump

Monday, October 15th 2007, 8:56 pm

By: News On 6

NEW YORK (AP) -- The head of the Federal Reserve sees clouds on the economic horizon.

Ben Bernanke is warning that a deepening housing slump probably will be a "significant drag" on economic growth into next year.

And Bernanke told the New York Economic Club that it will take time for Wall Street to fully recover from a painful credit crisis.

Ben Bernanke said that the fed will "act as needed" to help financial markets function smoothly and to keep the economy and inflation on an even keel.

The speech was Bernanke's most extensive assessment of the country's current economic situation since the August turmoil unhinged Wall Street.