Richmond Federal Reserve President Jeffrey Lacker said he believes that the economy has hit bottom and that a recovery is under way during a speech Tuesday to the Virginia House Appropriations Committee.
From the Wall Street Journal report:
Citing a boatload of improving U.S. economic statistics, Lacker told lawmakers he expects the U.S. economy will grow at a reasonable pace next year. “Housing should continue to recover from a very depressed state, consumers should gradually expand spending, business investment should make something of a comeback, and these components of demand should overcome a continuing drag from commercial construction,” he said.
Lacker noted that the auto and housing sectors are no longer dragging down growth and that many major banks have the capital necessary to support new lending. “Although many borrowers naturally face tougher credit terms in a soft economy, the banking system as a whole appears capable of supporting business investment and expansion,” he said.
On the downside, Lacker said that unemployment remains a pocket of pain within the U.S. economy.