(Bloomberg) -- Henry Kravis, co-founder of private equity firm KKR & Co., is upbeat about the U.S. economy this year and next, and says the Federal Reserve is doing the right thing getting back to normal.
“Interest rates are starting up but they are still very low, relatively speaking; there is plenty of capital available, banks are in much better condition today than they were back in 2007,” he said to reporters in Tokyo. “I don't see anything today on the horizon in the U.S. that says we are going to go into a big downturn quickly. I think 2018 is going to be fine, I think actually 2019 will be fine.”
Last month, the U.S. unemployment rate dropped below 4 percent for the first time since 2000. Overall, the U.S. job market is going strong without overheating, while the economic expansion -- which this month became the second-longest on record -- is on solid ground.
“The Fed is doing the right thing, they're starting to unwind their balance sheet and we'll get back to normal,” Kravis said. “You can't run on extra fuel all the time, you have go back, and we have to fly on our own.”
To contact the reporters on this story: Finbarr Flynn in Tokyo at fflynn3@bloomberg.net, Takako Taniguchi in Tokyo at ttaniguchi4@bloomberg.net.
To contact the editors responsible for this story: Andrew Monahan at amonahan@bloomberg.net, Finbarr Flynn
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