(Bloomberg) G-7 agrees to take “all necessary steps” and will back all “systemically important financial institutions.” However, they don’t trust each other enough to guarantee interbank lending:
The G-7 officials shied away from endorsing a U.K. proposal to guarantee lending between banks either by turning central banks into clearing houses for the loans or having governments back them.
Paulson confirms his domestic priorities:
Paulson signaled his top priority, having secured $700 billion rescue package from Congress, will be to buy equity in financial companies to restore market stability and ensure economic growth. He added that “we have more to do in the liquidity area.”
Paul Kedrosky provides the vague, full text G7 statement.
Mike Shedlock (aka Mish) mans the GM, Ford death watch. Meanwhile, GM and Chrysler discuss merger
Felix Salmon tells us why the time to trust Paulson is over. Cites two critical moments of failure: Lehman and IMF meeting.
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