Davos: In a candid admission of the problems plaguing the world's largest economy, US Treasury Secretary Timothy Geithner said on Friday the country was seeing "very high levels of poverty and inequality".
Geithner's comments at the World Economic Forum (WEF) annual meeting in Davos came on a day when the US government data showed that the country's economy grew 2.8 per cent in the last three months of 2011.
"(There are now) very high levels of poverty in this country, very high levels of inequality and an erosion in people's confidence in their (upward) mobility," Geithner said.
Pointing out that American economy is still repairing the damage caused by the devastating financial crisis, the Treasury Secretary said that people still have too much debt.
"Unemployment is still very high, housing and construction are still very weak...," he noted.
Presenting a cautious picture on the country's growth prospects, Geithner conceded that there are tremendous challenges and said it is "still very dependent on how the world unfolds".
The escalating European debt turmoil has cast a shadow on the global economy while the US economy is growing at a slower pace than expected.
According to Geithner, the US economy is expected to grow between two and three per cent this year. "I think that's a realistic outcome as long as we don't see a lot of risks coming out of Europe," he said.
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