--GM's Smith: US econ situation not like Japan's bubble
--GM's Smith: US econ problems short-term; not insurmountable
--GM's Smith: US to benefit from tech investment
--GM's Smith: Fuel cell technology future of auto industry
--GM's Smith says Hughes talks continue; too soon to comment
--GM's Smith: Has been hard to get shareholder value from Hughes
--GM's Smith sees 2nd half "a little on the slow side"
--GM's Smith: Covisint will lower operating costs for members
--GM's Smith sees SUV market affected if gas over $2/gallon

By Penelope Wood, BridgeNews
New York--Feb. 8--General Motors Corp. Chairman Jack Smith said Thursday he is optimistic about the U.S. economy despite the short-term economic problems the country is facing. Smith said the current economic situation is surmountable, and not as dangerous as the one Japan faced when its economic bubble burst in the late 1980s, as U.S. policymakers are more sensitive to the risks and the United States has less debt than Japan did. In addition, the U.S.
has invested more in technology, which has had a "historically good" payoff.
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Speaking at the Japan Society here, Smith said he doesn't see a lost decade like Japan had.
"If history is a guide, the U.S. will respond by encouraging consumers to spend through interest rate and tax cuts," said Smith, suggesting these policy moves would help the U.S. and General Motors transcend near-term difficulties.
Smith anticipates a slow second half this year, but the company's outlook for earnings of 24 cents a share for the first quarter, a fraction its fourth-quarter net of $1.15, suggests GM's whole year might be a little more than a little on the slow side.
"US sales won't match 2000," Smith said.
Commenting on talk of a tentative $70 billion merger between GM's Hughes unit and News Corp., Smith confirmed the companies were in discussions, but said he can't "go beyond that. It would be premature." A spin-off of Hughes by GM would preclude the deal.
Word that the companies were close to a deal that would bring DirecTV into Murdoch's stable of satellite operations was reported by the Financial Times of London Tuesday night. The Times also said that Microsoft Corp. could take a minority stake if the deal goes through.
Smith did say, however, that Hughes was a great company with a lot of growth potential, but that it was "hard for us to get shareholder value from the company," which has a complicated ownership structure. End