President Bush on Thursday morning said that his administration is focused on the current economic crisis and is committed to taking decisive action, but that “serious challenges” remain.
“Our financial markets continue to deal with serious challenges,” he said, “speaking to reporters at the White House, having canceled a day trip to Alabama and Florida.”
Mr. Bush recited the list of government interventions in recent weeks, including an injection of $180 billion by the worlds major central banks Wednesday night, and said “these actions demonstrate my administration is focused on meeting these challenges.”
“The American people can be sure we will continue to act to strengthen and stabilize our financial markets and improve investor confidence,” the president said.
Mr. Bush spoke to Treasury Secretary Henry M. Paulson Jr. earlier in the morning and said he will meet with him later in the day.
Mr. Paulson and Federal Reserve Chairman Ben Bernanke have made several remarkable moves just this week, which have still failed to stave off a crisis that grows graver by the day.
The Dow Jones Industrial Index fell by about 500 points on Monday and by another 450 points on Wednesday, stemmed only by a 150 point gain on Tuesday.
The most recent move came Wednesday night when the Fed coordinated an expansion of swap lines with the European Central Bank, Swiss National Bank, the Bank of Japan, the Bank of England and the Bank of Canada.
“These measures, together with other actions taken in the last few days by individual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work together closely and will take appropriate steps to address the ongoing pressures,” the Fed said in a statement on its Web site.
The Fed also acted late Tuesday with a loan of $85 billion to insurance giant American International Group.
Mr. Bush said that allowing AIG to fail “could have caused a severe disruption in our financial markets.”
But the AIG bailout followed the governments refusal over the weekend to prop up the investment bank Lehman Brothers Holdings Inc., leading to the firms collapse.
Merrill Lynch avoided their own implosion over the weekend by selling to Bank of America.
And last week, the federal government took responsibility for mortgage giants Fannie Mae and Freddie Mac.
The president canceled his scheduled trip to Alabama and Florida on Thursday in order to stay in Washington and “continue to work with his economic advisers on the serious challenges confronting our financial markets,” said White House spokesman Tony Fratto.
“The health of our financial markets is critical to the nations economy, and the President remains focused on taking action to stabilize and strengthen our markets and to restore investor confidence,” Mr. Fratto said.
The Dow opened up about 150 points on Thursday morning and rose roughly 50 points as the president spoke.