Wednesday July 29, 06:32 PM
Obama sees 'beginning of the end' of recession
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RALEIGH, North Carolina (AFP) - The United States may be seeing "the beginning of the end of the recession," President Barack Obama said Wednesday, as the world's biggest economy combats its worst slump in decades.
"Here is what's true: we have stopped the freefall. The market is up and the financial system is no longer on the verge of collapse," Obama said, while citing improving job and home sale numbers.
"So there is no doubt that things have gotten better. We may be seeing the beginning of the end of the recession."
Speaking at a town hall in North Carolina, where unemployment is around 10 percent, Obama cautioned: "that's little comfort if you're one of the folks who lost their job and haven't found another."
He also questioned the cover of the current edition of Newsweek magazine, which pronounced that "The Recession is Over."
"I imagine that you might have found the news a little startling. I know I did," Obama said.
The United States is now losing jobs "at nearly half" the rate of when he took office in January, he added in mounting a defense of his plans to stimulate the economy.
New US home sales leapt 11 percent in June, in a further sign of recovery for the sector at the epicenter of the global financial crisis, according to government data. Sales of new single-family homes also rose to a seasonally adjusted annual rate of 384,000.
In an attempt to prod the economy back to recovery, Obama signed a 787-billion-dollar stimulus package in February aimed at ending the worst US economic crisis since the Great Depression of the 1930s.
The US economy has been in recession since December 2007, according to the economic panel accepted as the arbiter of business cycles.
The economy suffered a 5.5-percent pace of decline in the first quarter, on the heels of a 6.3-percent slide in the fourth quarter of 2008. But many forecasters are expecting growth to resume in the second half of 2009.
"It will take time to achieve our complete recovery," Obama acknowledged. "But there should be little debate that the steps we took, taken together, have helped stop our economic freefall."
The US Federal Reserve this month raised its outlook for 2009 and 2010 economic output, projecting a rebound in the second half of 2009 that would leave the contraction for the year at between 1.0 and 1.5 percent.
For 2010, the new Fed outlook saw growth in a range of 2.1 to 3.3 percent, slightly better than its forecast from April.
The government's first estimate for gross domestic product in the second quarter to June 30 is to be released Friday. The consensus forecast by private economists is for a 1.5-percent rate of decline.
Obama, whose favorability ratings have dipped in recent polls as Americans expressed doubt at his economic plans, also defended government bailouts of major financial companies and struggling US automakers General Motors (NYSE: GM - news) and Chrysler (Xetra: 710000 - news) , despite record public deficit numbers.
The president, who is putting his political capita in play and multiplying public appearances to defend his plans for health care reform, reminded his critics that his administration inherited a 1.3-billion-dollar deficit.
He again stressed the need for reform, while seeking to tamp down worries over his plans to overhaul the US health care system, which leaves some 47 million Americans uninsured.
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