By Amy Wyeth
Banker & Tradesman Staff Writer
 
The financial sector won’t be re-experiencing the “golden age” it once did anytime soon, according to former Harvard University President Lawrence Summers.

Speaking this morning at a Greater Boston Chamber of Commerce breakfast, Summers, who also served as U.S. Secretary of the Treasury under former President Bill Clinton, predicted that the current U.S. financial turmoil could “start to return to normalcy” by next spring.

Summers said the financial industry won’t soon get back to the unsustainable economic position it held just two years ago, noting that what goes up, must come down.

“Financial services [represented] 40 percent of corporate profits in the United States in 2006,” he said. “The fact that it was that high should have been an indicator that it would decline.”

However, he indicated retirement fund management could be an industry growth area.

“People do have to retire. They’ll have to put more money aside, and that means people are going to have to manage it,” he said.

How fast the U.S. recovers from the current economic crisis will depend on how well government and business officials respond to it through regulation and policy decisions, he said. Adding to the problem are issues of ever-increasing health care costs and difficult energy policy decisions.

“These are all central questions,” said Summers, who is also advising the presidential campaign of U.S. Sen. Barack Obama (D-Ill.) on those issues.

Even in times of economic crisis, Summers said, the business world should also “recognize [there are] great moments of opportunity,” to respond effectively to the crisis.