Gold Prices at $1,150
After moving in a listless fashion for much of the day, the Dow Jones Industrial Average tumbled 109 points, or 1%, at 10,861. The S&P 500 was losing 10 points, or 0.9%, at 1179, while the Nasdaq fell by 11 points, or 0.5%, at 2425.
Bernanke discussed the financial crisis and the Fed's various responses at the Dallas Regional Chamber in the afternoon. The Fed chief called for an end to financial institutions that are too-big-to-fail and highlighted the need for enhanced powers to wind down failing financial firms. Though the economy is healing, Bernanke, again, raised concerns about the labor and housing markets.
But separately, Hoenig, who has dissented over the Federal Open Market Committee's policy statement language to keep rates at near-zero for an "extended period," said concerns about bubbles and inflation may require a proactive fed funds rate hike toward 1%.
Jay Suskind, senior vice president at Duncan Williams, said investors may also be staying on the sidelines in anticipation of the start of earnings next week.
"The market has priced in pretty robust earnings and I don't think there's a lot of room for disappointment," he said. "If results look good and look to remain good going forward, then we might blow through 11,000 as people try to get in on the rally. But if earnings disappoint, or companies appear cautious, then you'll see more of a pullback."
Former Fed Chairman Alan Greenspan testified before the Financial Crisis Inquiry Commission for its three-day investigation into how subprime lending, securitization and government-sponsored enterprises like Fannie Mae(FNM) and Freddie Mac(FRE) contributed to the financial crisis.
TheBank of Japan held a key interest rate at 0.1%.
Overseas, Hong Kong's Hang Seng rose 1.8%, and Japan's Nikkei increased 0.09%. The FTSE in London slid 0.3%, and the DAX in Frankfurt fell by 0.5%.
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