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The meeting at the White House this morning continued talks that began last night when finance ministers came up with a five-point plan. NPR's Michele Kelemen reports.
MICHELE KELEMEN: As they posed for what they call their family portrait, the finance ministers of the leading industrialized nations tried to show the world they are working in a coordinated way to tackle the global financial crisis that has proved to be far more serious than anyone anticipated. Treasury Secretary Henry Paulson came out describing the communique they issued as something more than the usual, a real plan he hopes will restore investor confidence.
Secretary HENRY PAULSON (Treasury Department): We've got an action plan. Let's work on these action plans together. Let's do it in a robust away. And let's communicate regularly, so we do it in a way which supports the common good.
KELEMEN: In the statement, the U.S., Britain, Canada, France, Germany, Italy, and Japan vowed to take decisive action and use all tools to support what they call systemically important financial institutions. Paulson announced that the Treasury Department is moving forward with a plan to buy an ownership stake in troubled American banks, though he didn't offer specifics on that. He only promised to move quickly.
Secretary PAULSON: We're going to do it as soon as we can do it and do it properly and do it effectively right.
KELEMEN: He said this is a period like none of us has ever seen before. While the G7 countries agreed on the broad outlines of next steps, Paulson explained that countries are going to have different needs and will approach the problems differently. That was a thought echoed yesterday from other foreign ministers, including Alistair Darling of Britain.
Mr. ALISTAIR DARLING (U.K. Chancellor of the Exchequer): What each country does may differ. The important thing is that through whatever means it's got available to it, each government supports the system. Because unless we've got a banking system that is robust, or a banking system where confidence is being restored, then the problems we see today will be exacerbated.
KELEMEN: The French minister of the economy, Christine Lagarde, also said the most important thing was to agree on common principles, such as not letting major financial institutions collapse.
Ms. CHRISTINE LAGARDE (French Finance Minister): It is necessary to enter into this recapitalization process by taking a stake in the institutions, sorting it out, doing away with the management if necessary, putting in place the right teams, sorting the whole place out, and then returning it to the market.
KELEMEN: Though she says she doesn't want to play the blame game, Lagarde does think it was a mistake for Treasury Secretary Paulson to let the global financial services firm Lehman Brothers fail last month, because that led to a widespread distrust among banks which then became reluctant to lend to each other.
Ms. LAGARDE: That decision has precipitated a series of events that have unfolded, that are unfolding, and that have precipitated further, additional, and deeper financial crisis.
KELEMEN: She was speaking yesterday at the Council on Foreign Relations where the moderator pointed out that Lagarde was once on France's synchronized swimming team, so she should know a thing or two about how to coordinate with others. The French finance minister joked that her swimming taught her something else that might prove useful. You have to hold your breath. Michele Kelemen, NPR News, Washington.
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