Transcript: Treasury Secretary Timothy Geithner

This Week

ABC NEWS, THIS WEEK WITH GEORGE STEPHANOPOULOS INTERVIEW WITH SECRETARY OF THE TREASURY TIMOTHY GEITHNER

STEPHANOPOULOS: Tim Geithner, a lot of good news out there this week. But, the bad news is the consumers are still real scared. Even though their income went way up, their spending went way down. What more can the Administration do if anything to encourage spending to go back up?

GEITHNER: George you are right, there are signs the recession is easing. And if you think about where we were last at the end of last year, we were on the verge of freefall, a financial system on the verge of collapse, and the actions this Administration has taken have been very effective in helping stabilize conditions, help repair the financial system, bring down the cost of credit.

STEPHANOPOULOS: Have you created a bottom?

GEITHNER: But I think we have a ways to go,. I want to emphasize the basic reality still that unemployment is very high in this country. We need to make Americans more confident about their future.

STEPHANOPOULOS: How do you do that though?

GEITHNER: I think you need to do it through by just making people understand we're going to do what's necessary to get growth back on track. We're going to stick with this until Americans are more confident about their future. Businesses have access to credit. Families are going to put their kids through college. That's going to be the ultimate test and the policies the Administration put in place working with "Congress were designed to provide very substantial support to make sure we get through this.

STEPHANOPOULOS: You mention the big problem of unemployment, and we're still nowhere near the kind of growth it would take to create jobs. More than 2 and half percent growth to start to create jobs. I know the Administration has that that's not going to come until next year. But some private economists now say it could happen in the second or third quarter of this year. They look at these numbers and see that. Do you have any reason to believe they're right?

GEITHNER: I think you're right to say the broad consensus of private forecasters is that you are going to see positive growth in the second half of this year and expect that to continue.

STEPHANOPOULOS: Above that two and a half percent level?

GEITHNER: Not clear yet. But you need growth before you get business to start creating jobs again and that's what we're going to be very focused on doing that.

STEPHANOPOULOS: Should Americans expect that more jobs are going to be created this year or not?

GEITHNER: What I think you are going to see first is growth turn positive. And then you are going to see the pace of job losses slow materially, they've already slowed significantly as you've said. They're going to slow materially further. Again most private forecasters, let's use their judgment, suggest you're going to see unemployment start to come down maybe beginning in the second half of next year.

STEPHANOPOULOS: And what about the flip side. What are the chances we're going to see a second dip later this year?

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