New York: As early signs of an improvement in the US economy surface, the Obama administration continues to promote the notion of a steady recovery.
While unemployment continues to be a concern, Lawrence Summers, director of the White House’s National Economic Council, tells CNBC’s Maria Bartiromo that growth may emerge in the second half of the year.
The President talked about some glimmers of hope, but added that we are in for some tough news ahead when it comes to unemployment. Can you tell us where the growth has been coming from, and where the weak spots that remain in the economy today are?
I think if you look two months ago, you couldn’t find anything positive. Every statistic was running negative; you really had no...almost no positive indicators, and a sense of an economy in free fall. I think today the picture is more mixed.
Optimistic: National Economic Council director Lawrence Summers. Susan Walsh / AP
There are still, obviously, problems in the financial markets; there’s obviously still weakness in housing; but you have a number of things that are more positive. You have the fact that production now is running below sales, pointing to inventory decumulation, which will be followed by an inventory cycle that can be a source of strength. You have a sense of a more mixed picture in terms of consumer spending and not the kind of free fall, in part because the stimulus that the President provided in the Recovery and Reinvestment Act (that) is coming into people’s pay cheques, and that is putting a little more energy into the consumer.
When would you expect to see growth in the economy again?
Well, you know many forecasters are looking for growth in the latter part of the year. As I mentioned earlier, the inventory cycle points in that direction. No one can make forecasts with complete confidence, and even if there is an inventory cycle, what’s really important is that we have a sound foundation for long-term growth.