Bush Addresses 'Sluggish' Economy

President Bush acknowledged on Friday that the economy is in a period of "sluggish growth" and urged Congress to extend his tax cuts and pass legislation to reform the distressed mortgage market.

The president noted the high unemployment rate -- which reached 5.5% in May, the biggest jump in over two decades -- as well as the record foreclosure rate reached in the first quarter.

"This is a time of turbulence in the housing market and slow growth for the overall economy," Bush said during a swearing-in ceremony for Steven Preston, the new secretary for Housing and Urban Development. He added that the high unemployment rate is "clearly a sign that is consistent with slow economic growth."

Americans have lost 324,000 jobs so far this year. They also lost $1.7 trillion in net worth during the first quarter as home values declined and investments posted weaker returns, the Federal Reserve reported Thursday. Tighter lending standards and waning asset value have limited people's access to credit.

Surging food and energy costs have become just another burden for the weak economy to carry, with gasoline prices inching toward a national average of $4 per gallon. Oil hit a new record above $137 on Friday, promising more costly fill-ups at the local Exxon(XOM Quote) station ahead as the country enters the summer travel season.

Despite the downcast economic state, Bush also sounded some optimistic tones. He mentioned the economic stimulus checks that are arriving in consumers' mailboxes and bank accounts, saying the country is "beginning to see signs that the stimulus may be working."