It’s Undeniable at This Point that the Economy is Moving Forward – Blankfein

In an interview on FOX News Channel’s (FNC) Your World, Lloyd Blankfein, Chairman and CEO of Goldman Sachs (GS), talked about President Obama’s efforts in urging Congress for a short-term package before the sequester is scheduled to go into effect and said, “I think it’s quite appropriate to try to find some reasoned alternative to the kind of doomsday backstop of the sequestration.” Additionally, on whether there will be cutting back on the expenditure side, Blankfein stated, “I think we need to get it, so I think we will.” Additional excerpts below:

On the state of our finances and the recovery:

“I think a recovery is on track. It’s not strong enough, it’s not steep enough, but I think it’s undeniable at this point that the economy is moving forward. We’ve seen housing prices bottom out, we’ve seen growth, employment is going up we’d like it to be faster but its nevertheless going up. And I think a lot of the economic numbers are if anything surprising a bit to the high side. There are some winds in front of us it’s not smooth but I think it’s undeniable that we are entering a growth phase at this point. It’s weak there’s some worry it could backbend and I think that’s why the central bank is keeping its extraordinary measures going which I frankly approve of even though it’s risky at this point. But nevertheless I think at this point the conclusion is its going forward but we can’t be complacent.”

On President Obama urging Congress for a short-term package before the sequester is scheduled to go into effect:

“I think it’s quite appropriate to try to find some reasoned alternative to the kind of doomsday backstop of the sequestration. I think it’s a good idea to be searching for some solution other than the automatic spending cuts.”

On whether there will be cutting back on the expenditure side:

“I think we need to get it, so I think we will. And I think the President has said and I think the implications are there that previous offers are on the table. I haven’t really seen in detail what they are, but presumably the negotiating parties know what they are. So it’s still a dance where everyone is waiting for the other side to take its turn, but I’m sure each side expects to give a little bit more.”

On President Obama’s proposal including an increase in taxes on the rich:

“The budget is moving out of control, at this point, largely because of the acceleration of tax expenditures. I think, predominantly, at this point we’re looking for some cutting back on the expenditure side. I think that’s going to have to be a focus.”

On whether President Obama wants to reform entitlements:

“I don’t read what he’s willing to do or unwilling to do. What I’m talking about is the mathematics of it which is kind of immutable at this point. There won’t be a social security if the income of social security doesn’t match the expenditures for the social security program. That’s just mathematics.”

On the President’s overall policy:

“Well I don’t think that’s policy; I think that’s politics. The fact of the matter is each of these sides in this debate can add and subtract and multiply and divide the same way I can it’s just a matter of getting it done. Nobody comes to me, I mean I’m only used to deal making on Wall Street, that’s the minor leagues compared to Washington. I think each side knows that the lines are diverging forever between the revenue that the government is taking in and the expenses that the government is incurring particularly because of geometrically progressing entitlement spending and those lines have to be made to converge. Both sides have given a little bit at this point. A little more work has to be done.”

Courtesy of FOX News Channel’s Your World

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