Geithner says government was 'surprised' by derivatives

Earlier today, Treasury Secretary Timothy Geithner told an assembled group of lawmakers that the Obama administration's plan to stimulate the U.S. economy is on the "expected path." The White House plan calls for an economic stimulus that will allocate billions of dollars to construction and other local projects. Geithner's statement was made before a joint hearing of the House Financial Services and Agriculture committees on Capitol Hill.

The Treasury Secretary was asked where the plan went wrong, which led Geithner to opine that unemployment is inescapable during a recession. He added that the stimulus plan "was necessary and critically important to reduce the risk that we'd see hundreds of thousands of losses of jobs, and we'd see millions of job losses beyond this point, and see thousands of more businesses fail unnecessarily." Geithner also pointed out that the rate of decline in the economy has slowed, that consumer confidence is improving, that the financial system is healing, and that concern about a financial meltdown has receded.