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Officials Paint Positive Picture of US Economy - 2004-02-23


Treasury Secretary John Snow says the U.S. economy is on a strong growth path, thanks to the tax cuts that were approved by Congress last year.

Mr. Snow told a Washington gathering Monday that an expanding economy will create a lot of new jobs. But he did not repeat his earlier assertion that more than two million jobs will be created this year. The treasury secretary spoke at a meeting of personal finance counselors.

"We're moving on a good path. We're on a strong path," he said. "Growth in the third quarter was an astonishing 8.2 percent. In the fourth quarter it was four percent. And the forecast for 2004, this year, the private sector forecasts all call for growth of from four to five percent, really strong, strong growth rates."

At the same meeting, Federal Reserve Board Chairman Alan Greenspan said American consumers seem to be in good shape. He said they are able to carry more short-term debt, in large part because they have been cushioned by rising home prices. The lowest interest rates in 40 years have prompted millions of Americans to refinance their 15- or 30-year home loans, something that has typically reduced monthly mortgage payments.

Mr. Greenspan did acknowledge that personal bankruptcies have risen to high levels. But the evidence, he said, suggests most personal bankruptcies resulted from the economic slowdown that ended over over two years ago.