Obama sees ‘glimmers of hope’ in US economy

10 April 2009 20:34  [Source: ICIS news]

WASHINGTON (ICIS news)--President Barack Obama said on Friday there are “glimmers of hope across the economy” and that the US is making progress toward recovery although it is still under severe stress.

Speaking with reporters at the White House after meeting with his top economic advisors, Obama said that “we’re starting to see progress”, citing a pick-up in home mortgage lending and increased credit availability for small businesses.

With Federal Reserve Board Chairman Ben Bernanke and Federal Deposit Insurance Corp (FDIC) Chairwoman Sheila Bair flanking him, Obama said: “As a consequence of some excellent work by Ben and some coordinated activities between the various agencies, what we’ve seen is mortgage interest rates go down to historic lows, and we’ve seen a very significant pick-up in refinancing.”

“That has the effect of not only putting money in the pockets of people but also contributing to stabilisation of the housing market,” he added.

The long-troubled US housing market, which recently has shown some small signs of bottoming out, is a key downstream consuming sector for a wide variety of chemicals, plastics and derivative products.

“We feel very good about the progress that we’re making in unlocking lending in some particular markets, for example in the small-business area,” the president said.

“I am pleased to discover that because of our actions we’ve seen a 20% increase in the largest SBA loan programme in the last month alone,” Obama said, referring to the federal government’s Small Business Administration (SBA) lending facilities.

Under a variety of SBA loan programmes, companies with as many as 1,500 employees or annual sales of up to $32m (€24m) can be categorised as “small business” and eligible for low-cost federally secured loans.

“And what that means is that small businesses are starting to get money that allows them to keep their doors open, make payroll, and that is going to contribute to our overall economic growth as well as help make sure that people are able to keep their jobs,” the president said.

He also cited federally funded infrastructure projects that are beginning to get under way across the country.

“What you’re starting to see is glimmers of hope across the economy,” he said.

Obama cautioned, however, that “the economy is still under severe stress...and we’re still seeing a lot of job losses, a lot of hardship.”

He said that over the next several weeks “you will see some additional actions by the administration.”

“What I wanted to emphasise today, and I think that Ben Bernanke and Sheila Bair and our economic team as a whole would agree, we’re starting to see progress,” he said.

In addition to Bernanke and Blair, Obama met with Treasury Secretary Timothy Geithner and Securities and Exchange Commission (SEC) Chairwoman Mary Shapiro among others.

($1 = €0.76)

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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