US President George Bush said today that despite diving stock markets and fears of global recession, now is not the time for nations to abandon open market policies or approve changes that would threaten free enterprise.
Mr Bush used his weekly radio broadcast to address anxiety about the financial meltdown, which Federal Reserve Chairman Alan Greenspan told Congress this week had left him in a “state of shocked disbelief”.
The president, who is hosting a meeting of world economic leaders on November 15 in Washington, called for patience and expressed confidence the economy would eventually rebound. He called on the leaders at the summit to recommit themselves to the fundamentals of “long-term economic growth – free markets, free enterprise and free trade”.
“And this moment of global economic uncertainty would be precisely the wrong time to reject such proven methods for creating prosperity and hope,” he said.
Over the past few weeks, governments have taken unprecedented steps to thaw frozen credit markets and avert what economists predict could be a long recession. Still, stock markets around the world fell on Friday and oil prices dropped to their lowest in more than a year on rising fears that governments, central banks and finance ministers could be powerless to stop a global downturn.
The Dow Jones industrials ended the day down 312 points at the 8,378 level, while all the major indexes fell more than 3%. Major European exchanges that were down more than 10% during the day improved by closing time but still suffered losses as high as 5%. Asian stocks also closed sharply down. Russia’s two exchanges were shut down early because of double-digit losses and officials said they wouldn’t resume trading until Tuesday.
“Americans from all walks of life are continuing to feel the effects of the financial crisis,” Mr Bush said.
“In recent weeks, concerns about the availability of credit, the safety of financial assets and the volatility of the stock market have made many families understandably anxious about their economic future.”
He said steps the government has taken to stabilise the economy, such as the passage of a $700bn (€551bn) plan to buy bad assets from banks and other institutions and enhanced federal guarantees of deposits, are beginning to show results.
“It will take time for their full impact to be felt,” he said.
Bill Burton, spokesman for Democratic presidential candidate Barack Obama, said the president’s efforts on the economy have fallen short.
“After casting his ballot for John McCain,” Mr Burton said, “George Bush took to the airwaves and eloquently endorsed his economic plan that represents four more years of policies that give billions in tax breaks to CEOs and big corporations but does nothing to create jobs or provide relief to more than 100 million middle-class Americans.”