Mr. Obama made his remarks at the start of a campaign to promote his ideas for reducing the deficit, while Mr. Geithner made the rounds of business television programs.
The appearances came a day after the S.P. revised its outlook on the country’s Triple AAA rating — the highest level — to negative from stable, an announcement loaded with political implications because it cited the need for Republicans and Democrats to agree on a plan to reduce the deficit.
As Mr. Geithner took the lead for the administration in responding to the S.P. warning, President Obama focused on the deficit. In his first stop, at a town hall meeting in Virginia, Mr. Obama said there was “general agreement” between Democrats and Republicans on the need to cut spending by about $4 trillion over the medium term.
But “it won’t be easy. There are going to be some fierce disagreements,” said Mr. Obama, who is also planning stops this week in California and Nevada.
Both President Obama and Republican lawmakers have suggested plans to cut the federal deficit by at least $4 trillion over the next 10 to 12 years, but disagree on methods.
In his comments, Mr. Geithner tried to reassure investors that the Democrats and Republicans would reach a deal, a concern at the heart of the S.P.’s reasoning for lowering its outlook.
He said there was “no risk” that the United States would lose its AAA credit rating and that investors were still confident in government bonds, strongly disagreeing with the negative assessment of the nation’s outlook by the Standard Poor’s ratings agency.
“Again, if you look — if you listen carefully now, you see the leadership of the United States of America, the president, the Republican leadership in both houses and the Democrats recognizing now that this is the right thing to do for the economy,” Mr. Geithner said according to a transcript of the Fox Business News interview.
Representative Eric Cantor, Republican of Virginia and House majority leader, who on Monday called the S.P. decision a “wake-up call,” said on Tuesday that the government was a “fiscal train wreck” with more than $14 trillion in debt.
“House Republicans have taken an honest, responsible approach to confront the debt crisis facing our nation,” he wrote in an opinion article published by The Culpeper Star Exponent in Virginia.
In its warning, the S.P. questioned whether government leaders would be able to agree on how to address the medium- and long-term budget challenges by 2013.
But Mr. Geithner said that a long-term deficit reduction plan can be in place before the 2012 election: “Absolutely,” he replied in response to a question. “We have a chance to make progress on that just in the next couple of months.”
“Our challenge now is to lock that in, in terms of reforms that Congress passes, so that people around the world will look at the United States and know that we’re not going to get behind the problem, we’re going to get ahead of it,” Mr. Geithner said in an interview on CNBC.
Mr. Geithner also said that he did not think the S.P. decision accelerated the need for a vote on the debt ceiling.
“There is a lot of confidence in the capacity of this economy to grow to make sure that we can meet our commitments or obligations,” Mr. Geithner told Bloomberg Television. “You can see that in that price at which we borrow every day, but we have to earn that confidence.”
When asked whether foreign buyers of United States debt had to be reassured, he added: ”Absolutely not. Look at the price at which we borrow.”
Anthony G. Valeri, a senior vice president and market strategist for LPL Financial, said there was little movement in the bond market on Tuesday, with the 10-year yield at 3.32 percent in the early afternoon and narrower credit default swaps, suggesting that the market does not see the default risk changing for United States Treasuries.
As such, he said that Mr. Geithner’s appearances seemed intended to ease political concerns rather than financial ones.
“I think he is trying to do potential damage control in Treasuries,” Mr. Valeri said. “Not that he needed to. The bond market saw right through the S..P move.”
“I think the market has moved on, and we have also got the Easter and Passover holidays this week,” he said.
The Dow Jones industrial average was up 0.50 percent, after a decline of more than 1 percent the previous day, less than two hours before the close of trading. The broader S. P. 500-stock index was up 0.46 percent, and the technology-heavy Nasdaq gained 0.14 percent. The three indexes posted their largest one-day drop in more than a month on Monday after the announcement.
In the Asia-Pacific region, stocks fell broadly but shares rebounded in Europe, after a sharp decline on Monday.
The S.P. announcement reverberated in global economies.
China’s foreign ministry said in a statement on its Web site on Tuesday that the United States must take “responsible” measures to protect investors in its debt.
It said that United States debt “reflects the credibility” of the government, and said China hoped the United States takes “responsible” measures to safeguard the interests of investors.
Government officials in Japan voiced their support of the United States.
“The United States is tackling fiscal issues in various ways, so I still think U.S. Treasuries are basically an attractive product for us,” Japan’s finance minister, Yoshihiko Noda , said, according to Reuters.
Bettina Wassener contributed reporting.
Article source: http://feeds.nytimes.com/click.phdo?i=1ee1317a0292bb00c61ecae6105d178c
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