Friday, October 16, 2009

US' Geithner warns ending stimulus will imperil recovery

This is one of the news that I follow very closely -- when are the authorities going to withdraw their stimulus supports or plan to raise rates to mop up liquidity. As long as they send consistent messages to the markets that they are going maintain loose monetary policy. It's still a good bet to remain in the markets. However, let me speak like a pro with a twisted tongue: that does not mean we don't have corrections along the way. As soon as the corrections are over, we are going to see new highs......good enough?

(TheStar)NEW YORK: Treasury Secretary Timothy Geithner said Thursday the economy is in the midst of a recovery that could be imperiled if the government's support systems are removed too quickly.

"A classic pattern in past financial crises is governments tend to put on the brakes too soon, withdraw support too early, and that's been a very costly mistake and we're going to be very careful to avoid that mistake," Geithner said at a conference sponsored by The Economist magazine in New York.

Geithner stressed that a robust recovery depends on businesses investing more in the economy and that it is the government's responsibility to give them the tools to do that.

While he said he's seeing signs of improvement, Geithner stressed that the recovery will be slow.

No comments: