U.S. Treasury Secretary Jack Lew painted a bullish picture of the U.S. economy at Davos. While problems in the global economy might create problems for U.S. companies with global exposure, it won’t prevent the U.S. economy from growing. “We have a very strong economy that is going to remain strong, ” Secretary Lew told Bloomberg. “While we have exposures to the world, it’s not a question of turning direction.” Global weakness might impact the U.S. but only “a few tenths of a point.”
While other countries are trying to devalue their currencies to make their products competitive abroad, as Prime Minster Abe in Japan did with the Yen, the U.S. is just fine with its strong dollar. With the European Central Bank discussing monetary easing and the Swiss National Bank taking the cap off of the Swiss franc, Lew said at Davos, “The strong dollar, as all my predecessors have joined me in saying, is a good thing. It is good for America. If it’s the result of a strong economy, it’s good for the U.S. and it’s good for the world. If there are policies that are unfair, if there are interventions that are designed to gain an unfair advantage, that’s a different story, ” said Secretary Lew.
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Low gas prices, which have reached a six year low, are good for the American consumer. When prices at the pump reached below $3, many reacted with pleasant surprise, and now that some are paying below $2, consumers react with jubilation. The losers are the oil and gas producers in the U.S., however, that have seen stock prices tumble.
