Treasury Secretary Timothy Geithner told CNBC in an interview that the U.S. economy will grow at a significant rate in the second half of this year and show positive growth in 2010 at a level that will begin to gradually bring down the unemployment rate. Is he right? Bruce Kasman, chief U.S. economist at JPMorgan, offered his insights.
“I don’t think we’re going to have a double dip—I think we’re going to have a lift and carry,” Kasman told CNBC. “We’re growing at 3.5 to 4 percent now and I think we’re likely to sustain that.”
Kasman said the stimulus will help boost incomes, improve financial conditions and will ultimately boost jobs in a “more self-sustaining recovery.”
“The possibility of having continued support from inventories is very strong here,” he said.
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“We’re not restocking—we’re still destocking at over a $100 billion pace in the last quarter and we’re going to continue to see very significant support...as monetary policy continues to work through the system.”
U.S. consumer sentiment fell unexpectedly this month, according to reports on Friday, on persistent worries that the "dismal" state of personal finances would not recover quickly from the worst recession in decades.
“This was a disappointing report, but doesn’t change the trajectory, which is toward improvement,” said Kasman. “The improvement in consumer confidence is going to continue on a trend basis.”
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No immediate information was available for Kasman or his firm.