J. P. Morgan exec: Squabbling in D.C. is holding back U.S. economy
(CBS News) DAVOS, Switzerland - In a survey of investors by Bloomberg, 36 percent said America's fiscal woes are the biggest threat to the world economy -- more than the 29 percent who named the European debt crisis. We're covering the mood in Davos, where a meeting of world bankers is taking place.
"I think the U.S. economy wants to be strong," said Mary Callahan Erdoes, CEO of JPMorgan Asset Management. "It wants to be."
But she also said the bickering in Washington is holding it back.
As one of the most powerful women on Wall Street, Erdoes presides over $1.2 trillion in investments.
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"The U.S. has to realize it's got so much going for it," she said. "Let's just get ourselves to come together as a team -- one team running the country helping that country to get itself back on stable footing, which then cascades to the rest of the world."
Watch Anthony Mason's report about the mood in Davos:
So how much does it hurt the economy if this is not confronted?" "It hurts us tremendously," she explained. "It hurts confidence in the U.S., it hurts confidence of CEOs to know, 'How do I invest? What are the rules gonna be?' We got to get back to believing that business is good -- American business is good."
Erdoes is making her fourth trip to the world economic forum in Davos. The talk here is of recovery.
"It feels much more hopeful," she said of the atmosphere this year. "It was just a year ago we were talking about country defaults and company defaults.
ecoIn Europe now, they are looking at the U.S., wondering why Washington is so hopelessly gridlocked. As one columnist in Davos put it: "The U.S. economy now carries a permanently heightened level of political risk."
Is that an exaggeration? "I think when you listen to the people in Davos who aren't from America, that's what they think," said Erdoes."They watch the TVs and read the newspapers and that's sort of all they hear. And we need to get that off of the headlines. And we need to go back to looking at these great companies that are some of the leaders of the industries of the world."
But overall in Davos, the mood is more markedly upbeat this year. Among the hundreds of corporate chairmen and CEOs, there's a growing sense that after four years of dealing with the fallout from the financial crisis, they finally turned the corner.
As for the other dangers to the world economy that is being discussed in Davos, one looming economic threat that has been raised is global warming. The head of the International Monetary Fund, Christine Lagarde, in a speech Wednesday night, said that she sees global warming as the wildcard that could unravel economic growth, and that if we don't deal with it, in her words, the next generation could be "roasted, toasted, fried and grilled."
