US President George W. Bush offered assurances Friday, Oct. 10 that the US government was doing all it could to keep the world's largest economy afloat ahead of a meeting with other G7 leaders in Wasiungton.
President Bush said the US already had the tools necessary to halt the crisis
Bush's comments came 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 percent 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 touts global cooperation
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 US finance firm Lehman Brothers.
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 the rest of the world.
Isolated efforts won't work: Steinbrueck
Steinbrueck says the crisis is beyond "case-by-case" answers
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 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.