WASHINGTON (MktNews) - Treasury Secretary Paul O'Neill late Friday afternoon again said there is nothing unusual about equities markets showing volatility, declining to comment directly on this week's slide, but noting that the economy is not in recession in his view.
In an interview with CNBC television, O'Neill said up front when asked whether the economy is in a recession, "I don't think so."
"We're very much where I think we've been now for a couple of months. We're running a low rate of real growth, nevertheless I think positive real growth," he said.
Referring to conversations he had with Federal Reserve bank regional presidents just ahead of Tuesday's Federal Open Market Committee meeting, O'Neill said, "As I listen to them, I in fact maybe notched up a little bit from the range I've been saying of -0.5% to 0.5%. I guess listening to them I would say 0% to maybe 0.75% or so," O'Neill said.
"Automobile sales are still running a significantly above what the pessimists were anticipating going into the beginning of this year. ... Again housing and autos are holding up. Final demand numbers across the economy don't look too bad," he continued.
O'Neill repeated that he does not feel it is "appropriate" to comment on market movements.
"If you have as much gray hair as I do, then you know that the markets are going to go up and down."
"We have absolute optimism about our economy going forward," he added.
"You can't help but feel sympathy for people whose portfolios have been impacted by the sharp declines," in the stock market, O'Neill said.
Describing himself as a CNBC viewer too, O'Neill said he has seen information indicating that "the Dow reduction is not remarkable yet in terms of a usual pattern that one sees in the cyclical activity of the stock market."
"Take a look and pay attention to the intermediate and long-term. This is a fabulous economy. And it will be reflected again in the stock market."
He also encouraged investors to focus on the long-term picture. "People who are investors in the United States economy in a broad, general sense are going to do well over time," he said.
O'Neill laughed off a question about dollar policy, saying only, "I'm never going to say anything about dollar policy if you keep me on two hours," he told CNBC's Ron Insana.
He also declined to comment on the Federal Reserve's recent interest rate cuts, but noted that "it does take some time for them to work their way through the economy ... so it will take a little while for interest rates to move through, but there's a certain level of anticipation and, I don't know, we'll see."
The Treasury secretary also said he intends to stick with his decision to retain his Alcoa stock options, despite some controversy over whether this raises conflict of interest issues.