Treasury Secretary Timothy Geithner said focusing on cutting the budget deficit now would jeopardize economic growth at a time when jobs are starting to be created, but even if that occurs, the unemployment rate will stay high for "a long period of time." Bruce Kasman, chief U.S. economist at JPMorgan, discussed his views.
“We’re going to see permanent losses in jobs with an economy that will be growing quite well—but will only slowly bring the unemployment rate down,” Kasman told CNBC.
“We’re going to need 5 to 6 percent growth to really heal this economy relatively quickly.”
But Kasman said the economy will bring strong gains for corporates.
“I don’t think the stock market is determined by the level of unemployment, the stock market is determined by the flow change in growth and corporate earnings,” he said. “This is a recovery which has got legs—it’s going to generate over 4 percent growth in the next couple of quarter.”
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No immediate information was available for Kasman or his firm.