April 9, 2009 -- Larry Summers, director of the National Economic Council, predicted today that the country's economic "free-fall" will end within months and ignored the interruptions of protesters at a speech this afternoon in Washington.
"I think the sense of a ball falling off the table -- which is what the economy has felt like since the middle of last fall -- I think we can be reasonably confident that that's going to end within the next few months and you will no longer have that sense of free-fall," Summers told the Economic Club of Washington.
"How strong, how rapid the turn will be -- that's a less clear question," he noted.
About halfway through the session, as Summers fielded questions from moderator David Rubenstein of the Carlyle Group, two protesters walked onstage with a large pink banner that read "We want our $$$ back!"
"Larry Summers is part of the problem," they yelled. "He's a toxic mess!"
"You should resign!," they screamed.
As the protesters stood there barking at the former president of Harvard, Summers sat calmly and silently, unflinching, until the protesters were escorted out of the hotel ballroom after a little over a minute onstage.
Once they were gone, Rubenstein asked him, "When you were minding your own business at Harvard, when you were a university professor, have you ever had second thoughts about coming back to Washington?"
Quipped Summers, as the screams of protesters could still be heard from outside the ballroom, "You know, David, there are moments that are more pleasant than others."
Summers: Economy Will Improve but Concerns Remain
Even with the administration's numerous programs, including the $787 billion stimulus package, the top economic adviser to President Obama warned that the nation's recovery will take time.
"You have to see that there are still substantial downdrafts in our economy, that economies don't go from losing 600,000 jobs a month to a terribly happy path overnight," Summers cautioned. "You have to see that there are still substantial strains in credit markets, but you also have to see that there has been a substantial anecdotal flow in the last six to eight weeks of things that felt a little better."
The former Treasury secretary would not venture a guess on when the nation's soaring unemployment numbers might start to improve.
"I think there are seven cameras there, which means there are seven too many for me to provide a number at which it might be likely to peak," he said, pointing to the assembled media presence as the audience laughed.
Summers today also expressed concerns about the risk of deflation and inflation.
"Frankly there are risks of both deflation and inflation," he said, adding, "I don't think that the concern about deflation in the near-term is one that can be entirely discounted."