Washington - President George W Bush offered assurances
Friday that the US government was doing all it could to keep the
world's largest economy afloat, as global stocks were in free-fall
and ministers from the world's richest nations prepared for a crucial
meeting.
Bush said a 'startling' drop in US stocks in the last few days was
being 'driven by uncertainty and fear' and insisted the US already
had all the tools necessary to resolve the financial crisis.
'This has been a deeply unsettling period for the American
people,' Bush acknowledged. 'We will continue to act to resolve this
crisis and restore stability to our markets.'
US stocks have plummeted more than 10 per cent in the last three
days and continued falling on a wild trading day Friday. European
stocks also tumbled, leading some countries to temporarily halt
trading.
Bush said that international cooperation was key as finance
ministers from the Group of Seven industrial nations were set to meet
in Washington.
'The world is sending an unmistakable signal: We're in this
together, we will come through this together,' Bush said in a
statement outside the White House.
The G7 bloc will also look to reassure the markets in a statement
following its first meeting since the financial crisis broadened
significantly last month, starting with the bankruptcy of Lehman
Brothers Holdings Inc.
Ministers could announce a joint commitment to intervene in their
struggling banking industries. Ministers and central bank heads
acknowledged cooperation was the only way forward in a crisis that
has spread from the United States, to Europe and to the rest of the
world.
German finance minister Peer Steinbrueck said Germany was weighing
its own large-scale rescue of banks in Europe's largest economy.
'The downward spiral has gathered pace. Case by case answers are
not going to help any more, even in Germany,' he said in Washington.
Bush will meet with the G7 ministers on Saturday, while Treasury
Secretary Henry Paulson will also be hosting an emergency meeting of
finance chiefs from the world's 20 leading economies, in a sign of
how far the crisis has spread.
Dominique Strauss-Kahn, managing director of the International
Monetary Fund, said Thursday the world was on the 'cusp' of a
recession. The IMF and World Bank also hold their annual meetings
this weekend.
Bush announced no new moves to ease the US credit crunch that has
curbed the availability of loans to consumers and small businesses.
Instead he cited the litany of US government interventions and
powers already in play after Congress last week passed a 700-billion-
dollar rescue package that gives the Treasury broad authority to
intervene in the banking system.
'We know what the problems are, we have the tools to fix them and
we are working quickly to do so,' Bush said.
USA
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