Bernanke sees recession risk

Fed chairman says economy may shrink - the closest he has come to proclaiming recession. He defends Bear Stearns rescue as not a bailout.

Federal Reserve Chairman Ben Bernanke, in his most pessimistic and blunt assessment to date, said Wednesday that a "recession is possible" for the U.S. economy.

Bernanke, speaking before a congressional committee, said he wasn't yet prepared to declare that the economy has fallen into a recession. Instead, he said that he believed the economy is still "slightly growing at the moment." But he added that he believed it is possible that the economy could shrink over the first half of this year.

In his opening remarks to the Joint Economic Committee of Congress, Bernanke he also said he expects further rises in unemployment and says the economic outlook has worsened since the Fed's economic outlook was released in January.

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