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European Fears 'Overblown': Alcoa CEO

Worries about Europe sovereign debtare "overblown," Klaus Kleinfeld, the CEO and chairman of Alcoa told CNBC Tuesday.

“I think the European Unionhas been a huge success, and at the same time when you see the political process in Europe, I think it’s fair to say that some people are saying, ‘Hey, why should we bail out some countries in the Europe space without seeing first what programs, what austerity programs, they put in place?’ ” added Kleinfeld.

“And once we see that, and they do it in a credible fashion, we back them. The political will for stabilizing the euro is very, very strong in Europe.”

Demand for Alcoa’s products is brisk and has led to increased production this year.

Kleinfeld said also that he thinks the Federal Reserve’s latest quantitative easing plan is well-intentioned, but that other actions need to be tackled to stimulate the US economy. Recently, the Fed agreed to buy an additional $600 billion in government debtas one way of spurring growth in the economy.

The CEO said that two actions are to encourage more technological innovation and loans for medium and small-size businesses.