Oct. 31--Treasury Secretary Timothy Geithner sees a new caution in America and believes that's a good thing.

A generation of Americans has been sobered by the financial crisis, Geithner said, and he expects that to affect their stomach for risk for a lifetime. As a result, he said, he thinks people will save more and borrow less while preparing for a future they now realize they cannot take for granted.

"They will look ahead and plan for an uncertain future," he said this week in Chicago. "Kids are growing up with a sense of risk, and that will be helpful."

Lenders, he said, also are likely to continue to be more cautious for some time.

Friday's Commerce Department report on consumer spending showed consumers are indeed being careful: As the "cash for clunkers" program ended, consumer spending fell 0.5 percent for September. Among investors, that raised concerns about the durability of the economic recovery, and the Dow industrials fell more than 249 points.

Although frugal consumer behavior "will slow the recovery" near term, in the long run, Geithner said, households and the economy will benefit. As Americans save more, he said, the country will be less dependent on borrowing money from foreign investors.

But for now, the economy faces challenges: Geithner said unemployment will likely climb further, and the economy will have to strengthen without as much help from consumers as in the past.

Although many experts are concerned about commercial real estate, Geithner told an audience of business leaders at the Economic Club of Chicago this week that he does not think failures in that area will revive a financial crisis. But he said the economy continues to be "fragile" despite signs of improvement. Though some observers have speculated that the U.S. will experience a "jobless recovery," Geithner said the recovery so far appears to be following a typical path.

Meanwhile, as consumer spending remains muted, the nation will have to grow by exporting more products, Geithner said.

Congress is debating whether to extend more incentives to jolt Americans into purchases. Proposals are being debated that would extend subsidies for homebuyers, for example.

Geithner did not take a position on further stimulus, but when asked at the Economic Club by Ariel Capital Management founder John Rogers, "How will we get consumers to spend again?" Geithner responded, "I look at saving as encouraging."

Yet as Geithner met with the Chicago Tribune editorial board Friday, he said the hundreds of billions of dollars the government spent to avert the financial crisis last fall was money well spent.