July 16, 2008 Bernanke: Fannie, Freddie in no danger of failing Play video

(NECN/ABC) - The Federal Reserve chairman is back on Capitol Hill, answering questions about the nation's economic plight. He was there yesterday, too, but today he has more to talk about -- discouraging news about inflation.

The message from the federal reserve chair was no different today.

Ben Bernanke: "The economy continues to face numerous difficulties, including ongoing strains in financial markets."

On Tuesday the Fed Chairman warned of inflation risks.

Wednesday, the government reported that inflation increased at its fastest rate in 16 years. And while Democrats are talking about another stimulus package for the middle class -- everyone is vulnerable.

And since money talks -- all the chatter now is about The 90 names on the FDIC list of troubled banks.

One silver lining showed up yesterday in the form of a red arrow when the weak economy caused oil to take an unexpected DIP DOWN NEARLY 5%, the biggest one-day drop in 17 years.

The latest ABC NEWS survey shows consumer confidence is at the lowest level in 27 years. And, more bad news may be on the way as more banks report their earnings later this week.

ABC's Linsey Davis reports.