The U.S. economy may be navigating some pot holes but is still moving ahead along the road to recovery, says Lawrence Summers, former director of the National Economic Council under President Barack Obama.
“We definitely hit a slower patch, but I think the basic fact that the terrible financial strains we had are abating,” Summers tells CNBC.
“It [economy] will be accelerating before too terribly long,” Summers says.
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Summers also defends the current economic policies calling for expansionary monetary policy and stimulus spending programs.
“There has been a debate for some time as to which is the most serious risk to our propriety: the risk that we'll make the mistakes of the 1970s and over stimulate, create inflation and end with stagnation; or that we'll make the mistake that Japan made in the 1990s; or the mistakes that the United States made in 1937 and declare recovery well established prematurely and end up with a period of being too stagnate for too long.”
The latter is the greatest risk, Summers says.
“Policy does need to be above all vigilant to make sure that recovery is well established.”
The U.S. gross domestic product grew at 1.8 percent in the first quarter, according to the Commerce Department.
While growth is a good thing, many would like to see more.
“Bottom line, things aren't falling off a cliff, but they're trudging along at what is likely to be a fairly weak pace,” says Keith Hembre, chief economist at Nuveen Asset Management, according to CNNMoney.
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