The real value in Mr. Bernanke’s speech is that he explained what really ails the economy — and made the case for a better fiscal response to address those ills. “Good, proactive housing policies” would speed recovery, he said, as would “putting people back to work.”

If Mr. Bernanke advocated specific policies to achieve those aims, he would be violating the etiquette that requires Fed chairmen to leave fiscal details to Congress.

So allow us. The best, proactive way to revive the housing market is to help bankrupt and delinquent borrowers rework their mortgages through principal reductions. It is also important to ease refinancing rules so underwater borrowers who are current in their payments can trade in their high-rate mortgages for lower-rate loans. The Obama administration is considering new refinancing rules, but mortgage investors are sure to resist.

One of the best ways to put people back to work is to fully reauthorize the highway trust fund, a big job creator and vital source of money for improving the nation’s infrastructure. Job creation also requires that federal funds are made available to repair and renovate schools, and to rehire teachers, police officers and firefighters who have lost their jobs in budget cutbacks.

Mr. Bernanke’s Warning - NYTimes.com

The editorial board of the NY Times pick up where Bernake left off. Why didn’t Obama?