Washington: US President Bush on Saturday tried again to ease global market as he met with world financial leaders to coordinate ways to stabilise markets after a disastrous week saw trillions wiped off the value of shares.
The G-7 ministers are trying to thrash out ways to calm the markets.
In a statement after the talks, Bush said he and representatives from the Group of Seven rich industrialised agreed that the scope of the crisis called for a global response but warned that there were no quick solutions.
"We recognize that the turmoil in the financial markets is affecting all our citizens," Bush said, standing in front finance ministers from the Group of Seven rich industrialised nations.
"All of us recognise this is a serious global crisis that requires a serious global response for the good of our people."
Bush, who a day earlier had appealed for calm amid wildly fluctuating markets, outlined efforts his country was taking to strengthen its financial system, including a plan to inject much-needed capital into banks.
But he cautioned that it would take to see results.
"The benefits will not be realised overnight," he said.
On Friday the finance ministers and central bankers from the US, Germany, Japan, France, UK, Italy and Canada announced a five-point plan to counter financial turmoil after the first round of talks in Washington
The plan of action includes:
- Take decisive action and use all available tools to prevent "important" institutions from failing.
- Take steps to unfreeze credit and money markets and ensure that banks and other institutions have broad access to liquidity and funding.
- Ensure that banks and other major financial intermediaries can raise enough capital from public and private sources to re-establish confidence and kick start lending to individuals and businesses.
- Ensure that each country's deposit insurance programs are strong and consistent to assure depositors their money is safe.
- Take action to restart the secondary markets for mortgages and other securitized assets.
Bush on Friday had tried to reassure markets that a bailout for Wall Street, which has been hardest hit by the fall-out from the collapse of the US sub-prime mortgage market would yield results
He said his government's "wide range of tools" included the $700 billion financial bailout, which he called "big enough to work."
This plan will authorise the Treasury to buy bad mortgage-related investments from finance companies, unfreezing the credit markets by freeing up banks and finance firms to lend once again.
The Dow Jones dropped 700 points at one point on Friday, bouncing back into positive territory briefly only to be about 300 points down, or about 3.6 percent, by noon.
It again recovered to close about 100 points down. The Nasdaq and S&P also closed less than one percent down.
London's FTSE, the CAC in Paris and the XETRA DAX in Frankfurt, Germany all closed down between six and eight percent.
Meanwhile, US Treasury Secretary Henry Paulson said the US Government was working on a plan to buy stock in financial institution by using part of the $700 billion.
The move follows a similar $84 billion rescue plan unveiled by the UK government this week aimed at keep the country's beleaguered banking system afloat.
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