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| Version 2 | Version 3 |
|---|---|
| Darling calls for economic action | Darling calls for economic action |
| (about 2 hours later) | |
| Chancellor Alistair Darling has described the credit squeeze as the "biggest economic shock" the world has seen since the 1930s Great Depression. | Chancellor Alistair Darling has described the credit squeeze as the "biggest economic shock" the world has seen since the 1930s Great Depression. |
| Speaking in Washington DC before the start of a meeting of the G7 group of most industrialised nations, he said the seven had to take "urgent action". | Speaking in Washington DC before the start of a meeting of the G7 group of most industrialised nations, he said the seven had to take "urgent action". |
| Yet Mr Darling also cautioned that such action meant better regulation rather than the temptation to simply add more. | Yet Mr Darling also cautioned that such action meant better regulation rather than the temptation to simply add more. |
| G7 ministers have gathered before World Bank and IMF meetings at the weekend. | G7 ministers have gathered before World Bank and IMF meetings at the weekend. |
| The G7 finance ministers are tipped to debate proposals including better oversight of banks and how to maintain access to capital. | The G7 finance ministers are tipped to debate proposals including better oversight of banks and how to maintain access to capital. |
| They are also expected to address the wide variation in currency exchanges, particularly the weak US dollar. | They are also expected to address the wide variation in currency exchanges, particularly the weak US dollar. |
| Slowdown | Slowdown |
| The Financial Stability Forum (FSF) think-tank is set to make a list of recommendations that G7 leaders will discuss. | The Financial Stability Forum (FSF) think-tank is set to make a list of recommendations that G7 leaders will discuss. |
| The IMF must focus its surveillance more closely on financial sector issues and on the links between developments in the financial sector and the real economy Alistair Darling | |
| The FSF is comprised of a number of central bank and treasury officials from around the world. | |
| Mr Darling said he would be calling for more measures to tackle any future global economic crisis. | |
| "That is why the IMF needs to work with the FSF to develop an early warning system," he said. | |
| "As part of this I believe that the IMF must focus its surveillance more closely on financial sector issues and on the links between developments in the financial sector and the real economy." | |
| 'Rapid implementation' | |
| US Treasury Under-Secretary David McCormick said he was looking forward to "discussing and implementing rapid and effective implementation of the FSF findings with our colleagues". | |
| Among the expected proposals are increased transparency about the risks banks undertake, stricter rules about credit ratings, and the role of central banks in pumping money into the finance system. | Among the expected proposals are increased transparency about the risks banks undertake, stricter rules about credit ratings, and the role of central banks in pumping money into the finance system. |
| The credit crisis, that stemmed from a slowdown in the US housing market, has had a knock-on effect worldwide and dented growth. | The credit crisis, that stemmed from a slowdown in the US housing market, has had a knock-on effect worldwide and dented growth. |
| Earlier this week the International Monetary Fund (IMF) forecast that the US would enter a "mild recession" in 2008 and said that the credit crunch could cost banks and other financial institutions around $1 trillion. | Earlier this week the International Monetary Fund (IMF) forecast that the US would enter a "mild recession" in 2008 and said that the credit crunch could cost banks and other financial institutions around $1 trillion. |
| The weakening US economy has been a major factor in pushing down the value of the dollar, which slipped to a 15-year low against the pound earlier in the week. Meanwhile the pound has fallen sharply against the euro. | The weakening US economy has been a major factor in pushing down the value of the dollar, which slipped to a 15-year low against the pound earlier in the week. Meanwhile the pound has fallen sharply against the euro. |
| The G7 members are the US, Britain, France, Germany, Italy, Canada and Japan. | The G7 members are the US, Britain, France, Germany, Italy, Canada and Japan. |