Infrastructure Spending Needed to Overcome 'Massive Deficit': CEO Lutnick
By: Gennine Kelly | Web Producer
The US economy will need strong and sustained economic growth in order to reduce the federal government's growing budget deficit, Howard Lutnick, Chairman and CEO of BGC Partners and Cantor Fitzgerald, told CNBC today.
"You need 1.6 (annual percentage growth) GDP to get us out of this massive deficit we are in now," Lutnick said.
"There is an interesting statistic, which says unless we invest in the infrastructure of this country, instead of on stimulus spending, then you can't build your business," he added.
Investing in infrastructure, according to Lutnick, is something the United States is "not doing."
Jeff Jane, the CEO of Modern Asset Management said yesterday he preferred the investment firm JeffriesGroup to Goldman Sachs because Congress is focused on "politics, not fundamentals" right now.
Today, Jeffries reported a very strong quarter,with investment banking leading the way.
With no Bear Stearns and no Lehman Brothers, firms like Jeffries and Cantor Fitzgerald "are going to be the winners in this market because they are focused on middle-market companies," Lutnick added.
And with low interests rates right now, this allows firms, like Jeffries, to make money, Lutnick concluded.
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"The Strategy Session," hosted by David Faber and Gary Kaminsky, airs weekdays at Noon ET on CNBC.