As leaders of the world's biggest economies dole out assurances, without offering much in the way of specifics, that they will take any necessary action to restore confidence in global markets, Wall Street appears to be facing further turbulence coming off one of its worst week ever.
"There is probably a lot of optimism based on this past Friday. So the markets may reflect the disappointment of the G7 not coming out with some profound, coherent, exact, precise program," said Wall Street Journal Washington D.C. bureau chief John Bussey. "They are for making sure there is enough capital in the system freeing up money markets; assuring that bank deposits are safe; getting banks lending to each other again and lending to individuals. My suspicion is that as the week wears on, the markets will metabolize that and be a little more encouraged."
President Bush continued his efforts this weekend to get the global community behind an economic rescue plan during the meeting the Group of Seven industrialized nations and the annual session of the International Monetary Fund and World Bank.
White House spokesman Tony Fratto said Bush acknowledged the economic problem began in the United States, but told participants, "We're all in this together."
"We've done so much damage to both the economy and to the financial system that this may drag on for a couple of years with subnormal growth," UBS Securities floor trading director Art Cashin said on "This Week" today.
Cashin said the bulk of the problem can be attributed to Lehman Brothers' collapse.
"In hindsight it's pretty clear that it was a drastic error to let Lehman go under, it spilled over into the money markets after that, when the money markets froze up they stop buying commercial paper which is the lifeline for much of American business," he said. "The stock market is merely the sideshow in this circus, it is the financial system that's there to use a different metaphor we're just the thermometer it's the patient it's the banking system that's got to get put back together and it's got to get put back together fast."
Bush said his administration was doing everything in its power to stave off the biggest market disruption since the Great Depression.
And while discussion of the financial crisis dominated at the G7, talk shifted today to the World Bank and its policy setting committee and concerns about how the fallout would affect developing and poor nations.
As a result of the downturn, developed countries are not expected to help 28 countries facing twin shocks of rising food and fuel prices, said former U.S. diplomat and trade negotiator Robert Zoellick. "For the poor, the costs of the crisis could be lifelong," he said.
In a joint statement the G-20 finance officials pledged to work together "to overcome the financial turmoil, and to deepen cooperation to improve the regulation, supervision and the overall functioning of the world's financial markets."
Under mounting pressure to stay viable, the automaker is said to be in merger talks with rival Chrysler LLC . The financial crisis has hit both companies hard.