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Top US Advisor:  'US Economy Back from the Brink'

A top economic advisor to U.S. President Barack Obama said the country's economy is no longer in a "free-fall" and substantial progress is being made.

Presidential Economic Advisor Lawrence Summers said fears of an economic collapse that had gripped the nation just six months ago are starting to ease.

"If we were at the brink of catastrophe at the beginning of the year, we have walked some substantial distance back from the abyss. A majority of businesses now report that they expect improved economic conditions - the opposite of six months ago," he said.

The comments from Summers, a former U.S. treasury secretary, came as investors and consumers were starting to see some signs of improvement.

Earlier this week, the second largest U.S. bank, JP Morgan Chase, said profits jumped by 36 percent for the three months that ended in June. And investment bank Goldman Sachs said its profits jumped 33 percent.

Summers said that shows the president's $787 billion recovery plan is working.

"Let me be absolutely clear. There is no financial institution that would be reporting the kind of positive results that we have seen in the last quarter but for extraordinary public support provided by the government," he said.

Some leading technology companies, including Intel, IBM and Google also said they expect the economy to grow stronger in the next six months.

Still, there are signs that the economy is still struggling. The most dramatic, a report Thursday that found one out of every 84 homeowners has been told they are in danger of losing their home.

Rick Sharga is with the real estate information services company RealtyTrac:

"We anticipate we will see over three million homes get a foreclosure notice this year. We probably won't peak until close to the end of this year," he said.

Critics of the Obama administration also point out the U.S. unemployment rate stands at 9.5 percent and that top economic officials say it will likely peak at more than 10 percent.

Presidential Economic Advisor Larry Summers admitted there will be setbacks, but he said the U.S. will emerge with a stronger, export driven economy.