For too long now, companies have been trying to limp along with the smallest number of employees possible and to postpone purchases until the last possible moment. Even the slightest whiff of an upturn in the economy triggers a chain of events that show companies they MUST hire more people to meet any increase in demand.

Simple as that. Is he serious?

To be in a constant state of Surprise.

Fed chairs are in an unusual position because their public predictions are not suppossed to accurate, but rather as accurate as possible while roiling business confidence the least.

Rather than read the tea-leaves in public pronouncements it's best to look at actual policy.

Since Bernanke has announced that the Fed funds rate will remain zero into 2014 we know that he believes:

1) There will be no "morning in America" rebound. If there was, it would have been in 2010.

2) Krugman was right. When Krugman published his Japanese liquidity trap paper 10+ years ago then-professor Bernanke agreed with an taught ts conclusions. a) inflation is a necessary part of the solution. b) in a liquidity trap inflation can only develop when the central bank promises inflation... promises to not raise rates when inflation first starts to develop. The problem is that you can print as much money as you want and it won't do a thing as long as market actors believe that the central bank will raise rates if the economy picks up. Since the US Fed as a quasi-political position Bernake cannot announce an inflation target of 3.5% (which would surely encourage borrowing at current rates and decrease the expected value of hoarding money) so the Fed has done the next best thing by promising not rate hikes for a very long time. That at least offers investors a good gambling chance of inflation developing without the Fed acting to nip it in the bud (along with any recovery)

A FED chairman who admits he doesn't understand what's going on.

Perhaps the unemployment rate is dropping more significantly than the growth would indicate because you have people dropping off at BOTH ends? Those who find jobs and those whose unemployment has run out and have "stopped looking".

Bernanke is right and it is nice of him not to make the obvious further observation that we will probably also see employment declines that are not in sync with GDP growth. Reversion to the mean. I hope they wait until after November.

The firing frenzy of the first days of the crisis was somewhat like a low inventory phase. If an extrinsic event causes everyone to cut their inventory then the restocking phase is also likely to be all-at-once. Same for hiring.

Everything associated with an event, from a collapse in bank confidence to 9/11 to a tsunami, will be "lumpy" because crisis events put everyone in the economy into sync.

without equal growth in payrolls and the economy.

Or all the numbers are a bunch of nonsense and/or smoke and mirrors that cannot fit reality.