The president said Friday he saw "glimmers of hope" in increased lending to small businesses, but the economy was still under "under severe stress." Analysts discuss the signs of economic recovery and the road ahead.
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After months of gloomy economic news and dark forecasts, President Obama pointed to progress today and what he called "glimmers of hope." He spoke to reporters after meeting with his economic team in the White House.
BARACK OBAMA, President of the United States: We feel very good about the progress that we're making in unlocking lending in some particular markets. We have also seen this month people starting to get their first checks, in terms of the tax cuts that were initiated through the recovery package.
And when you combine it with the other efforts that are being made across the country for infrastructure projects, for the kinds of innovative energy programs that were part of the recovery package, what you're starting to see is glimmers of hope across the economy.
There was some positive economic news this week, including better-than-expected retail sales and record profits at one of the nation's largest banks, Wells Fargo.
New jobless claims also fell slightly, fueling some hopes that the recession is bottoming out.
That helped lead to a fifth straight week of gains on Wall Street. The markets were closed today for Good Friday, but yesterday the Dow Jones Industrial Average surged more than 3 percent. All in all, stocks indexes are up 20 percent or more in the last five weeks.
But there's still plenty of data pointing to a prolonged recession. The number of people receiving jobless benefits reached nearly 6 million, and the unemployment rate stands at 8.5 percent.
President Obama said the economy is still under severe stress.
Right now we're still seeing a lot of job losses, a lot of hardships, people finding themselves in very difficult situations, either because they've lost their home, they've seen their savings deteriorate, and they're still at risk of losing their job. So we've still got a lot of work to do.
The president promised additional action in the coming weeks.
And for some perspective on what this week's developments say about the broader economic picture, we're joined by Steven Pearlstein, a business and economics columnist for the Washington Post, and Nick Perna, managing director of Perna Associates, an economics analysis consulting firm.
Welcome, gentlemen, to you both.
Nick Perna, beginning with you, what do you make of these conflicting signs we've seen this week?
NICK PERNA, Perna Associates:
They're very characteristic of what I call the pre-recovery stage of a business cycle. What we're getting is evidence that, if we're all taking calculus, we would call it a point of inflection.
In other words, the economy is going from a very accelerating rate of decline to a smaller rate of decline, but it's still declining. And there's conflicting evidence, because not everything lines up at this point, but what it's suggesting to us is that the economy should bottom out by the fall of this year, and recovery should start in terms of GDP this year, and labor markets next year.