USA TODAY - Bush acknowledges weakness in U.S. economy

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NEW YORK

Trying to calm jitters about the economy, President Bush conceded on Friday that the country "obviously is going through a tough time" but expressed confidence about a rebound.

In a speech to The Economic Club of New York, Bush said this was not the first time the economy has been rattled and he is certain that it will ride out its troubles. "These are uncertain times," he said.

The president spoke as evidence of an ailing economy piled up. The dollar fell, oil and gold hit record highs, the economy is shedding jobs, retail sales saw a big drop and the effects of a severe credit squeeze linger. Economic worries have replaced the Iraq war as the No. 1 concern of voters in this presidential election year.

"Every time, this economy has bounced back better and stronger than before," Bush said, showing his optimism about the resiliency of the economy.

He said unemployment was low at 4.8% and productivity was strong. But he acknowledged that prices are up at the gas pump and grocery stores and housing values are down.

"Hardworking Americans are concerned," he said. "They're concerned about their families. They're concerned about making their bills."

The president also praised the work of the Federal Reserve to boost the economy. The Fed on Friday said it has voted to endorse an arrangement to bolster troubled Bear Stearns and stands ready to provide extra resources to combat a serious credit crisis.

Bush said the Fed has cut interest rates several times and this week, the Fed announced a major move to ease stress in the credit markets by adding liquidity. "It was strong action by the Fed and they did so because some financial institutions that borrowed money to buy securities in the housing industry must now repair their balance sheets before they can make further loans," the president said.

"Today's events are fast moving, but the chairman of the Federal Reserve and the secretary of the treasury are on top of them and will take the appropriate steps to promote stability in our markets," Bush assured his audience.

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