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Investors are ‘trapped’ in stocks: Jack Welch

Welch: It's a 'where else do you go' stock market

The stock market is a case of "where else do you go," former General Electric chairman and CEO Jack Welch told CNBC on Thursday.

"You're trapped. Every individual you know is finally saying, 'I got to get in … I missed it,'" Welch said in a "Squawk Box" interview, lamenting about U.S. stocks being the only investment choice with any shot at reasonable returns.

He also addressed Wall Street's obsession with the U.S. Federal Reserve tapering its massive quantitative easing bond-buying program. " 'Taper' is a funny word. We ought to be talking about what we're spending," he said. "They're not there as much, but they're still there."

(Read more: Regulators size up Wall Street, with worry)

The latest round of QE has undergone to reductions of $10 billion each in December and January. The Fed is current pace of monthly asset purchases stands at $65 billion.

The next central bank policy meeting—a two-day affair accompanied by Janet Yellen's first news conference as Fed chair—is scheduled for next week. Following the meeting, the Fed will also release economic projections.

Investors will be looking to see whether the central bank thinks the recent economic slowdown can be attributed to more than just this year's brutal winter.

(Read more: Cramer deciphers confusing market message)

This has to happen for 3% economy: Welch

The U.S. economy has not changed in the last 12 months, said Welch, executive chairman of the Jack Welch Management Institute at Strayer University. "You've got a 2 percent economy," he said, though he said he does see signs of optimism.

While blaming the weather for skewing numbers in the first quarter, Welch added that the economy is more likely to grow at 3 percent than 1.5 percent going forward.

By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC.