James Bullard: "Cautiously Optimistic" About US Economy; Could See Job Growth in 2011

December 1, 2010 1:46 PM EST
In an interview with FOX Business Network, St. Louis Federal Reserve Bank President James Bullard said that he is "cautiously optimistic" about the state of the U.S. economy.

Bullard also sees the country on the brink of a strong recovery in 2011, as the European crisis has been a wakeup call for the U.S.

“The tax issue is a big one," Bullard said. "Congress and the President need to come to a deal to extend these tax cuts. The other thing that would help is get the long term fiscal situation under control. Europe is such a wakeup call for America. You can get in so much trouble by borrowing too much. We should take that lesson to heart here in the US.”

Bullard sees QE2 as a ordinary monetary policy and that it is normal for the the government to buy and sell treasuries.

“I have been saying all along I did not like the shock and awe kind of thing. I think the $600 billion number put us in the same category as a lot of other big fiscal programs and for those you put a big headline number out there and people put you in the same category. I don’t see it that way."

Bullard also does not side in favor of letting the Bush tax cuts expire, as it is not the right time amid the sluggish recovery.

“I don’t think you should be raising taxes in an environment where you are trying to get the economy going. I wouldn’t raise any taxes.”

As far as the debilitating unemployment rate, Bullard sees it being possible to get back to the job growth seen before the recession, adding that in "may happen in 2011."

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