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WASHINGTON (Reuters) - Finance leaders from the world's rich nations struggled on Friday to agree on a unified approach to cure a credit crisis that threatens to trigger a deep global recession.
of Seven -- the United States, Canada, Britain, France, Italy, Germany and Japan -- pledged a coordinated response but stopped short of backing a British plan to guarantee lending between banks.
Panicky financial markets were counting on the G7 to figure out some way to restore the normal flow of credit and shore up banks' balance sheets to avert the worst economic meltdown since the Great Depression of the 1930s.
"Markets and people the world over will be looking for a clear sign that governments of the largest economies in particular are prepared to act -- they are prepared to take firm measures that will make a difference," Alistair Darling, Britain's chancellor of the exchequer, told Reuters.
"We expect this weekend to show that we are determined to do that.
The G7 are expected to issue a communique summing up their views sometime after 6 p.m. (2200 GMT), but heading into their afternoon meeting there was little consensus on what they might say.
"We should not imagine that we will have a harmonized response that will be the same for everyone, quite simply because you cannot apply the same method to market situations that are different," French Economy Minister Christine Lagarde said. "What is important is to reach an agreement on common principles."
DOW'S WILD RIDE
The G7 members acknowledged they could no longer afford a country-by-country, case-by-case approach to crisis management after 14 months of turmoil.
The Dow Jones industrial average on Friday took a 1,000-point roller-coaster ride before ending down 1.5 percent at 8,451.19 as investors tried to pin down what might come out of a series of weekend meetings in Washington by finance officials from around the globe.
A European G7 official said one of the issues on the agenda for the G7 was whether U.S. Treasury Secretary Henry Paulson was "ready to say the United States will not let a bank of systemic importance go bankrupt and whether he is ready to say the United States is ready to take a stake in a bank. That's what's being discussed, we don't know what the answer is."
Italian Economy Minister Giulio Tremonti said a draft of the G7 communique that he read was "a bit weak."
"We see a text that was written in the old style, as if nothing has happened. We are not going to sign that text," he said in an interview with Italian television.
Italy had supported setting up a pan-European bank rescue fund, similar to a $700 billion U.S. bailout approved by lawmakers a week ago. The U.S. plan gives the Treasury Department authority to buy stakes in banks, although other European leaders have rejected that idea.
Britain this week committed 50 billion pounds to recapitalize its banks and offered to guarantee interbank lending by as much as 250 billion pounds to get credit flowing again.
Darling said he hoped other countries would follow Britain's plan. However, officials from two G7 countries said the group was unlikely to adopt the British approach this weekend.
"We will have to coordinate internationally, but beyond that there should be room for nation-specific solutions," German Finance Minister Peer Steinbrueck said. "What Great Britain has been doing is one approach, but that does not mean that it should be transferred to any other country." (Reporting by Reuters' G7 team; Writing by Emily Kaiser)
 
Regardless of personal views on Cramer, he is proposing on Mad Money an emergency solution that just might work. This is a true national emergency, and we have already acknowledged that the solution must be a bold one, without abolishing the free enterprise system. He proposes the U.S. full faith and credit effort to solve the credit freeze and lack of bank lending, but allowing the big financial institutions recover their lending ability and the trust of the investor in the government/private sector solutions. IMO this should be considered as part of the issues being discusssed this weekend at the G7 meeting. Let's enjoy the debate on the issues, while we continue to implement realistic solutions that may reduce the chance of a deeper recession - or worldwide economic depression.
 
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Geaux4it said:
We are truly heading for demise. The New World order?

Big brother needs to just step back and get out of the way. Take a hard look, government is buying houses, banking institutions and now stock? I don't like it one bit!

Socialism at it's core..

Geaux

View attachment 4864
Click to expand...

You know, maybe the government can come up with a new scheme - I just don't know. But I think they can't restore confidence any time soon and get people buying houses and cars and big tv's, etc. I think the ponzi scheme is over - for quiet a number of years now, the US economy has relied on ever-expanding consumption by people saving less and less and taking on more and more debt. The bubble has burst and the engine driving a lot of this expansion, rising home equities, has run out of gas. I think, at present, the best we can hope for over the next several months is to stabilize the financial system. I also think investor expectations that we will recover similar to what we did in the 2000-2003 may also be overdone. Unlike now, home equities did not appreciably shrink during the last recession and were the catalyst, helped by cheap money from the Fed and non-existent lending standards, for the 2003-2007 expansion. I don't see a similar large pool of potential credit collateral to fuel another expansion any time soon, particularly considering probable much-tighter lending standards. To top it all off, even a larger portion of older people have tapped out any equity they may have had with these idiotic "reverse mortgages". I see a rather long, drawn-out period of mailase similar to the mid to late 1970's.
 
I wish it was monopoly, as someone in the press said, it's more like 3-dimesional chess, or as I think of it, multi-planar, multiplayer chess. Where did that rook come from? Bam! Ow! I'm gonna get that rook! Where's my bishop? Where'd it go? Uh oh.... Sarkozy, move the pawn, I'll move my..hey, still can't find my bishop!
Monsieur President (Bush), your bishop is on my board and threatening my knight!
No it's not, that's not my bishop! Where's my bishop? Where'd it go?
 
In this morning's Rose Garden address, the President did not specifically give the interbank loan guarantee that seemed to be what people said is needed. Absent anything new, what's the likely market action next week? Do you still believe it's up?
 
Silverbird said:
I wish it was monopoly, as someone in the press said, it's more like 3-dimesional chess, or as I think of it, multi-planar, multiplayer chess. Where did that rook come from? Bam! Ow! I'm gonna get that rook! Where's my bishop? Where'd it go? Uh oh.... Sarkozy, move the pawn, I'll move my..hey, still can't find my bishop!
Monsieur President (Bush), your bishop is on my board and threatening my knight!
No it's not, that's not my bishop! Where's my bishop? Where'd it go?
Click to expand...
Does that mean the only one who can save us now is Spock? He's the only person I know who is any good at 3-D chess....:p

Lady
 
Warrenlm said:
In this morning's Rose Garden address, the President did not specifically give the interbank loan guarantee that seemed to be what people said is needed. Absent anything new, what's the likely market action next week? Do you still believe it's up?
Click to expand...

If they don't guarantee interbank lending, we will surely drop below the 2002 low of 768.

If they do guarantee it, and we have a hard rally, I think we could easily shoot up to S&P 1100. However, some have analyzed earnings over the next 12 months and given a 50% decrease, it would make the S&P fair value at around 750-800. So, any jaunt over 1000, and I would lighten up. For me, 1043 is the point at which I return to a 0% YTD.... 1161 and I'm back at 10.3%.
 
squalebear said:
Amen 12% ,,,, I've been up all night and the S&P Futures topped off
at +6.99%. They've come off their highs, but today should be more
then exceptional. Good Luck ! ;)
Click to expand...

Anyone have an 'IFT' they can loan me? I promise to re-pay my loan but I need the following,

No credit check
No employment check
Interest Only For 5 years
No fees

Oh, and I need you to inflate my yearly salary. Secondly, once I 'dead beat' out on you because I am a moron I want to to provide me with my 'entitlement' of a reduced rate after loan re-set and a reduced principle.

Deal?

Geaux
 
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