World Leaders Agree to Act Together on Financial Crisis

In a five-page communiqué that mixed broad principles with specific steps to be tackled in the next three months, the Group of 20 pledged to bolster supervision of banks and credit-rating agencies, to scrutinize executive pay at firms, and to use fiscal and monetary policies to cushion the blow of a downturn that is hitting countries around the world.

Pushed by President Bush, who convened the gathering at the suggestion of President Nicolas Sarkozy of France, the leaders reaffirmed their commitment to free markets and trade.

But the statement also laid blame for the crisis at the doorstep of the United States, saying governments “in some advanced countries” had taken inadequate steps to prevent a buildup of risk.

The meeting laid out a roadmap for overhauling financial regulations that would postpone most of the difficult decisions until Mr. Obama is in office.

Those measures include setting up a so-called college of supervisors, which would share information about global financial institutions, and a plan to harmonize accounting standards. Mr. Bush cited a proposal to move the trading of credit-default swaps, a financial instrument that has been blamed for some of the recent upheaval, into a central clearinghouse, which would allow regulators to monitor risk.

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Posted in * Culture-Watch, * Economics, Politics, Economy, Globalization, Politics in General, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--