Summers On Recession: "I Don't Think The Worst Is Over"

For this week's installment of their "Lunch with the FT" feature the Financial Times sat down with Larry Summers, director of Obama's National Economic Council, for a wide-ranging talk. When the conversation turned to the current recession in the U.S., Summers did not exude optimism:

Onward, then, to the toughest economic challenge Summers faces today: the recession. Here, Summers turns sombre: "I don't think the worst is over ... It's very likely that more jobs will be lost. It would not be surprising if GDP has not yet reached its low. What does appear to be true is that the sense of panic in the markets and freefall in the economy has subsided and one does not have the sense of a situation as out of control as a few months ago."

Read the rest of the interview.

Comments

[Rayme]

Please Larry, make up your mind, are we going to recover or not. we will have no recovery as long as 50 Cents on the Dollar goes towards taxes, government will have to shrink before we can start recovering.

[CaptainVideo]

Right wing dogma with no substance behind it. The economy recovered under Clinton AFTER he raised the taxes on the haves and have mores.

[krocklin]

Absotely. The rich have just gotten richer. And the Middle Class believed the propaganda. Not they are suffering the inevitable.
No regulation, loopholes for big companies - all this has been the rule for 30 years. Now we are paying the price.

[Patriot til Death]

The explosion of the internet and .com businesses had more to do with growing our economy in the 90s than anything Bill Clinton did. He just got credit for it.

If raising taxes is such an economy booster why don't we all pay 100% of our income to the government. I guess Cuba would be a good example to follow.

Right wing dogma? What is that?

[turfkiller]

Republicans: no goals just great at moving the goal posts.

[marthainmaine]

Remember when Larry Summers was getting grief for "working " for the hedge fund D E Shaw Group?Wikipedia stated he was part owner. Maybe the reason for the secrecy is D E Shaw Group is funding a wind farm corporation as shady as Enron. With a lot of Enron employees working for them ...and lawsuits everywhere they go.

Also benefiting from Obama's green energy iniative.

[ThatOne4Me]

wow...the cronyism just goes round and round.

[Patriot til Death]

I love it. We are painting ourselves into a corner where the only solution will be the Fair Tax or violent revolution. Either way big government is done. The people can only save themselves with their own money.

Why does government have to confiscate your money and spend it to save the economy when you an can spend it instead?

Wise up Democrats, your savior's economic policies are destroying our country. Whatever he takes from the rich to give to the poor will only last as long as the rich are willing to produce it. When they decide it's no longer worth it, then we collapse.

[ThatOne4Me]

We need to stop bailing out the rich. that's an important start. if they mess up, too bad! if you have investments with these big banks, you're money is part of a casino and you play at your own risk.

[Chubbster]

Bailing out the rich? You cant use the crude brush to paint the picture. How about we need to kick Geithner out of Goldman Sach's pocket.

[CaptainVideo]

Mindless right wing dogma not supported by any evidence.

Any tax labeled as a "fair tax" is not likely to be fair.

If the government spends a dollar, that DIRECTLY adds a dollar to expenditures on final goods and services. If taxes are cut by a dollar, part of that will be saved and used to pay down credit card debt. Therefore the amount DIRECTLY added to expenditures on final goods and services is a lot less than a dollar.

[Patriot til Death]

CaptainVideo,

First, go checkout fairtax.org. I not following what you are trying to say.

[BigPictureReg]

So, decapitate the current regime and install a new regime that, of course, is already identified, solid in all the right qualifications for steering things on the right path, if I understand you? For how much of the Republican party do you speak?

Just how does this new regime plan on establishing the credibility with the rest of the world while this 'revolution' takes place? Or, is that not a necessary part of the 'violent revolution'?

Caution. Your IP address is certainly registered somewhere in VA as we make this exchange.

[timbonotes]

And this guy gets paid for pouting ssuch rubbish?

You could interview a man on the street and come up with better news most of the time than this crud!

Has anybody told him this is a free-falling depression?

[northstar11]

he got the first three words right

[JohnSawyer]

"I don't think"?

[Fler]

I wonder how many of the people "in charge of" and "to blame for" and "earning retention bonuses" related to this situation are among the 52,000 people who might get outed on this list of people
evading taxes in offshore accounts:

http://www.huffingtonpost.com/huff-wires/20090712/us-ubs-secrets/

Note the request for delay is slipped in on a Sunday less than 24 hours before proceedings are to begin. NOBODY wants this front and center. Oh well, the accounts are probably in names that would disguise the true identities of the actual account holders anyway... would probably take months of dedicated research to sort it all out... these people are not stupid.

[LemonMeringue]

Republicans have been systematically destroying the economy bit by bit since Ronald Reagan.

Bill Clinton brought it back only to have the Republicans destroy it even more.

Republicans should never be given this chance again.

[timbonotes]

Clinton was a Rethug in sheep's clothing. He promoted NAFTA, "that giant sucking sound", and signed off on gutting Glass-Steagall. Robt. Rubin and Mr. Summers were his treasury secs. Need I say more?

[watchTVgetSTUPID]

Regarding Corporate control of our economy, our foreign policy, our wars, our government and our lives ... yes. But apart from that how has Clinton sold us out?

[samuelberg]

Of course the worst is not over. As long as Obama remains our president we'll have more corporate giveaways, lobbyist sleepovers at the W.H. andd boondoggle health care plans. The fun has just begun.

[RJII]

silly over dramatic. you just described business as usual in Washington DC.

[Rayme]

Please, clinton created jobs by firing the person making $50,000 a year and replacing it with 2 jobs making $25,000 per year.

[ftaco2004]

Lemon... time to do some research. Go back to 1913 and the Federal Reserve Banks. These are the cause of all the economy's problems. Political party has nothing to do with it but hate. No difference between the Democrat/Republican bickering than the white/non-white racism we have seen for centuries.

[peterg76]

Given his record of accuracy, this can only be good news!

[TrueSense]

This quote says it all about why we have the wrong people in charge of this situation:

"What does appear to be true is that the sense of panic in the markets and freefall in the economy has subsided and one does not have the sense of a situation as out of control as a few months ago."

This is their problem. They think this is the economy and this was what they need to worry about. Larry, just becuase you deregulated these guys and helped create this mess, believe in derviatives( even though Iris Mack may have shown you do not undertand them), and gotten paid by financial firms and those in derivatives, does not make that important to the rest of US.

You will find your weak recovery will make for a lot of angry voters !

[coco51]

Is there a petition for this guy to be "terminated" as they in Human Resources.. I admire the President's platform and his desire to rebuild the economy especially the middle class and the country as the confirmed leader of the world. However, he has held onto these Bush holdovers who like Bloomberg have no other experience than how to feed the greed within themselves.

Mr. President, Summers, Geithner and "King Henry" Paulson have kept you on the slippery road. Much as I hate to say this, you should bring Krugman into Treasury. Krugman may not have the social finesse you exemplify but at this moment when our unemployment is nearing 10% or our population, you might wanna ignore that and focus on someone who will "speak truth to greed and idiocy."

[Bude]

Go back to sleep Larry. We'll wake you when it's over.

[PPatt]

Wow, now that's special. Maybe we can approach depression era 33% unemployment without panic in the markets. Wouldn't that be special? How far we've come since the great depression.

[bascombe]

obviously, summers thinks we need to suffer a bit more so we can more readily accept the corporate yoke on our collective necks.

[Chaimirija]

I am waiting for the remote controlled collars...thing is, I am sure they would figure out a way to get people to buy them...on credit...

[lastams]

While having them made in China

[watchTVgetSTUPID]

Remote controled collars ... they were used to force a man to Rob a Bank. I guess this is the control Wall Street leaders want .... someone else to rob the banks for them

[Chubbster]

The yoke on your neck...how colorfully Marxist.

[bascombe]

it was to connote fascim. It might ring a bell. In marxism, Genius, there's no corporate yoke.

[munki]

He changes his mind or opinion frequent...
what is next?

[Chaimirija]

Tarot cards

[lastams]

Well, let's not pretend they don't know what they're doing.
Summer's buddies over at Goldman Sachs are making a killing on
oil futures right now.
Not only do they get to play the same leveraged casino game that they played with
sub-prime mortgages, now Americans get to pay them at the pump as well.
And they say these guys don't get it.

[thedirtman]

What America needs for a full recovery is a new round of technology. Technology will yield industry. Industry will yield jobs. Jobs will yield security.

What we need is another Al Gore to invent the internet.

[Chaimirija]

Web 2.0?

[Patriot til Death]

How about just getting back to the basics, where government doesn't play the nanny role that it does today?

It seems the more we grow government, the weaker our economy becomes. We don't need government to do anymore than the Constitution requires, yet, they are going to be the answer to everyone's needs. The only problem is they will require all of your money to "help" you.

Get out of my pocket and I'll help myself and a few others that can't physically or mentally help themselves. Those that can but won't, R.I.P.

[climatebabes]

Kick that criminal out!!