G7 Agree to 'Aggressive Action Plan' to Fight Global Economic Crisis, But Lacking Any Specific Course of Action

By David J. Lynch, USA TODAY

WASHINGTON — The G7 group of nations agreed Friday on what U.S. Treasury Secretary Henry Paulson called "an aggressive action plan" to combat a worsening global financial crisis.

The five-point, single-page document gave evidence of a shared approach on the part of several of the world's major economic powers, but the meeting ended with no specific new anti-crisis measures.

"Never has it been more essential to find collective solutions to ensure stable and efficient financial markets and restore the health of the world economy," Paulson told reporters.
That was evident on Wall Street Friday, where the Dow Jones industrial average plummeted more than 700 points at the opening bell before recovering to end the day down 128 points at 8451. The past month, the Dow has lost 25% of its value as markets grew increasingly worried about policymakers' grasp on the crisis.

In their highly anticipated meeting, the G7 finance ministers agreed to coordinate their individual responses to the financial upheaval that has roiled markets around the world, saying the gravity of the situation demanded "urgent and exceptional action."

But the joint communique released at the end of Friday's semi-annual meeting of finance ministers from the six nations contained no specific new commitments.

"It doesn't sound like any fresh initiatives…The market was hoping for some sort of bolder, coordinated initiatives," said Marc Chandler, senior vice president at Brown Brothers Harriman in New York.

In the days leading to today's meeting, hopes built in financial markets for specific measures that would address a crisis of confidence in the markets. Among them: provisions to guarantee lending between banks.

But Paulson said demands for "precisely the same policies" from countries with different legal systems, banking industry structures and regulatory systems was "naive."

Asked if today's statement would be enough to calm skittish financial markets, he said: "I think we'll have some volatility for a while," adding "This is about confidence. We need to restore confidence…And there is every reason for people around the world to be confident."