Despite some recent glimmers of hope, Bill Gates believes it could take several more years for the economy to fully rebound from the great recession, which many economists say began in earnest in late 2008 with the collapse of Lehman Bros and other investment houses.
"When you have a financial crisis like that, it's years of digging out," the Microsoft chairman said Monday during an interview on ABC's Good Morning America.
"The budget's very, very out of balance," Gates warned.
"And even as the economy comes back, without changes in tax and entitlement policies, it won't get back into balance. And at some point, financial markets will look at that and it will cause problems," Gates added.
Gates' comments come three days before Microsoft is slated to announce earnings for its fiscal second quarter. Analysts surveyed by Thomson Reuters expect the company to post earnings per share of 59 cents, on revenue of $17.79 billion.
In 2008, Microsoft posted second quarter earnings of 47 cents on $16.63 billion in revenue.
The interview coincided with the publication of Gates' annual letter from his charitable organization, the Bill & Melinda Gates Foundation. In the letter, Gates said he talked to co-trustee Warren Buffett "more than ever" during the past year to gain a better understanding of the financial meltdown.
"Although the acute financial crisis is over, the economy is still weak, and the world will spend a lot of years undoing the damage, which includes lingering unemployment and huge government deficits and debts at record levels," Gates wrote.
Still, there are indications that some markets are stabilizing and are in line for growth.
Research firm Forrester is calling for tech spending in the U.S. to grow 6.6% this year, to $568 billion, after being down 8.2% in 2009. Worldwide spending will jump 8.1% to more than $1.6 trillion, following a decline of 8.9% last year, according to Forrester.
Microsoft shares were up 1.42%, to $29.37, in early trading Monday as stock markets rebounded from Friday's sell off.
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File photo of Bill Gates.Bill Gates, the world's richest man and chairman of Microsoft, has said that he thinks it could take several more years for the global economy to rebound after the recent recession, which most economists believe began in late 2008.

Gates made the remarks while speaking earlier today in a televised interview with ABC's Good Morning America. "When you have a financial crisis like that, it's years of digging out. The budget's very, very out of balance," the billionaire commented. "And even as the economy comes back, without changes in tax and entitlement policies, it won't get back into balance. And at some point, financial markets will look at that and it will cause problems."

"Taxes are going to have to go up and entitlements are going to have to be moderated," he added. "We're having a slow recovery and everybody's frustrated by the pace of the recovery. But I don't think the government could change and magically make it speed up a lot. If you try to do too much, it can distort things. The government's role is more of a long term role, investing in education.

"We need leadership for these long-term trade-offs and I'm hoping that won't cut back a few key areas like aid to poor countries. But there's going to be cutbacks. We're seeing this at the state level right now, and so far it's not being handled very responsibly."

Gates' comments come two days before US president Barack Obama's State of the Union speech, expected to focus on the current economic situation, as well as the need to create more jobs. Three days from now, meanwhile, Microsoft is scheduled to announce it earnings for the fiscal second quarter of the year.