President Obama said Saturday that investors can have “absolute confidence” in the U.S. economy, continuing a recent push to shore up markets after months of dire warnings drove stock indexes to decade lows and prompted worry from the Chinese government that its investments weren’t secure.
Mr. Obama promised to “not go backwards” on free trade and warned against protectionism in the face of an economic downturn, though he said “it may be difficult” to get any new trade deals done.
The comments came as the president met with Brazilian President Luiz Inacio Lula da Silva at the White House in advance of a meeting of leaders from the world’s biggest economies, known as the Group of 20, or G-20, early next month in London.
“There’s a reason why even in the midst of the economic crisis you’ve seen actual increases in investment flows here into the United States,” Mr. Obama said in trying to boost faith in the U.S. economy.
“I think it’s a recognition that the stability not only of our economic system, but also our political system is extraordinary. And so I think that not just the Chinese government, but every investor can have absolute confidence in the soundness of investments in the United States.”
After months of arguing that the economy was in bad shape and needed government spending to rescue it, the president and his administration have tried over the past several days to argue that the economy is in better shape than some fear. In the past few days, Mr. Obama, his chief spokesman, his Treasury secretary and his chief economic adviser have made the case to various audiences.
Mr. Obama said security extends beyond just U.S. Treasury notes to investments in the private sector as well.
The new push comes as Chinese Prime Minister Wen Jiabao told reporters in Beijing on Friday that he is “definitely a little worried” about his country’s investments in the United States. China is the largest holder of the U.S. government’s public debt.
For his part, Mr. Lula da Silva said there’s some worry because as money flows to the United States in the midst of an economic crisis, it flees developing countries. He said that question and others will have to be addressed at the G-20 meeting.
“We have to make more, quicker decisions; that is to say, the number of unemployed people are increasing in the world, and the unemployed of today is a social problem of tomorrow,” Mr. Lula da Silva said, according to the official translation of his remarks as he sat in the Oval Office with the president.
He also obliquely raised the issue of immigration, saying the downturn in the economy may be leading to problems for immigrants.
“We have to take care of this issue very seriously, because we already see migrant workers facing many problems in different countries,” said Mr. Lula da Silva, the first Latin American leader to meet with Mr. Obama since his Jan. 20 inauguration, though the U.S. president met Mexican President Felipe Calderon during the transition period.
Mr. Lula da Silva heaped praise on Mr. Obama, but also set high expectations for him. He asked that Mr. Obama reopen the Doha round of World Trade Organization negotiations and said he is in “a unique and exceptional position” to get things done.
Mr. Lula da Silva added that Mr. Obama is unlucky to face such a crisis.
“I’m praying more for him than I’m praying for myself,” Mr. Lula da Silva said, adding that he wouldn’t “want to be in his position.”