Ben Bernanke addressed a Fed conference in Massachusetts on Monday night to quell fears about the Labor Department's recent report that showed a 0.5% jump in unemployment. Despite the recent spike, he said, the economy appears to have averted a "substantial downturn," due in part to the Fed's interest rate cuts, heightened demand from abroad for U.S. exports and the government's $168 billion in stimulus check payouts.

Not too long ago, Bernanke stated that despite signs of improvement, "conditions in financial markets are still far from normal." Translated from Fedspeak, Bernanke was really saying that the Fed had thrown in the kitchen sink and was waiting to see if the payouts took hold and helped to stimulate the U.S. economy. Well, the stimulus checks are in the bank, so to speak.

Although financed items like homes and vehicles are struggling, consumer spending seems to be normal. Business spending has been cautious, but it is also showing some signs of improvement. Overall, as both consumer and business spending returns to normal, then the U.S. economy will unquestionably be on the road to recovery.

The stimulus package was passed by Congress in early February. Essentially, the payments were made to low-income and middle-class workers with the intention of encouraging spending. When the package was first proposed in January, Bernanke refused to forecast that the U.S. economy was slipping into a recession, but he did endorse the government's stimulus plan. He expects that fiscal stimulus and monetary stimulus together "may provide broader support for the economy than monetary policies alone."

The stimulus plan also calls for expanded business depreciation by 50% on new capital equipment. Truthfully, this is the fastest way to help the economy immediately. Many economists say that the business tax cuts are too small and predicted that they will be ineffective. But this is an election year, and Congress wants to give voters a check. The closer these checks arrive to Election Day, the better it is for the incumbent politicians.

Overall, there's a lot of stimulus still coming down the pike. Even the presidential candidates are talking about sending out another round of payments next year. Will this help us avoid a recession? Well, I'll go out on a limb and say that the economy will avoid an official recession, but it's going to be a close call.

An investor's best defense is a strong offense of fundamentally superior stocks. Although economic recovery may be slower than we would like, the economy is recovering and stimulus checks are part of the reason for that. I've got some great responsible investment ideas to share with you through my Blue Chip Growth service. Put that stimulus check to good use and find out how to pick and how to invest in top stocks!