Obama becomes first black U.S. president

WASHINGTON (Reuters) - Barack Obama became the first black U.S. president on Tuesday, making history before a sea of people and declaring the United States in the midst of a crisis that can be defeated with a united sense of purpose.

President Barack Obama is sworn in as the 44th President of the United States during the inauguration ceremony in Washington, January 20, 2009. Michelle Obama watches at right. The Bible Obama uses is the same one that President Abraham Lincoln used at his Inauguration in 1861. (REUTERS/Jason Reed)

"Today I say to you that the challenges we face are real," Obama said in his inaugural speech shortly after taking the oath of office. "They are serious and they are many. They will not be met easily or in a short span of time. But know this, America -- they will be met."

Hundreds of thousands of people erupted in roars of approval on the broad National Mall grounds as they watched Obama stand with one hand raised, one hand on a Bible used to swear in Abraham Lincoln in 1861, and repeat the brief oath to become the 44th U.S. president and succeed George W. Bush.

Turning to crowds stretching way into the distance, Obama cited the worst economic conditions in 70 years and U.S. involvement in wars in Iraq and Afghanistan as having placed the country "in the midst of crisis."

"On this day, we gather because we have chosen hope over fear, unity of purpose over conflict and discord," he said.

PROMISE OF BOLD, SWIFT ACTION

Obama pledged bold and swift action on the "badly weakened" U.S. economy, a top priority as he works with the U.S. Congress on an estimated $850 billion economic stimulus package aimed at jolting the economy back to life.

On Iraq, Obama vowed the United States would begin to leave responsibly but cited no specific timetable.

He offered conciliatory words to Muslims while issuing a warning to those who would wage terrorism. In a message to the Muslim world, Obama said he would seek a "new way forward" based on mutual interest and mutual respect.

He also said: "We will not apologize for our way of life, nor will we waver in its defense, and for those who seek to advance their aims by inducing terror and slaughtering innocents, we say to you now that our spirit is stronger and cannot be broken; you cannot outlast us, and we will defeat you."

Obama said the economic crisis was a consequence of "greed and irresponsibility" on the part of some and vowed that those who manage Americans' money "will be held to account."

He also promised a "watchful eye" to ensure financial markets do not spin out of control.