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EU leaders call for transparency | |
(about 3 hours later) | |
The leaders of Europe's biggest economies have called on financial institutions to improve transparency in all their activities. | |
UK Prime Minister Gordon Brown met his French, German and Italian counterparts at Downing Street to discuss the recent market turmoil. | |
Mr Brown said credit rating agencies needed to increase investors' understanding of complex products. | |
The leaders also called on the IMF and other bodies to monitor risks better. | |
"We need a better early warning system for the global economy," Mr Brown told reporters. | |
"We want the prompt and full disclosure of the write-offs that are now to take place as soon as possible; I think these are the immediate things people want to be done," Mr Brown said. | |
Banks have been reporting massive losses related to investments in the ailing US housing market. | |
Rapid action | |
Mr Brown met German Chancellor Angela Merkel, French President Nicolas Sarkozy and Italian Prime Minister Romano Prodi. | |
"We want the kind of capitalism that promotes entrepreneurship not speculation," said Mr Sarkozy afterwards. | |
European Commission President Jose Manuel Barroso also attended the discussion. | |
The leaders said in a statement that if financial institutions did not rapidly address their concerns, they were ready to introduce rules and regulations as an alternative to "market-led solutions". | |
"We need to have more transparency on the valuation of these new, very complex financial instruments," said Ms Merkel. | |
Cooperation key | Cooperation key |
Earlier on Tuesday, Chancellor Alistair Darling told BBC News that cooperation was key to preventing an economic slowdown intensifying. | Earlier on Tuesday, Chancellor Alistair Darling told BBC News that cooperation was key to preventing an economic slowdown intensifying. |
"With the combination of the right regulatory response and the right economic response, I am confident that we will get through these difficulties and will continue to see growth." | "With the combination of the right regulatory response and the right economic response, I am confident that we will get through these difficulties and will continue to see growth." |
Consumer confidence is deteriorating across Europe as stock markets plummet and the Societe Generale rogue trader scandal makes headlines. | Consumer confidence is deteriorating across Europe as stock markets plummet and the Societe Generale rogue trader scandal makes headlines. |
And the US economy, a major destination for European exports, could be headed for a recession, some economists say. | And the US economy, a major destination for European exports, could be headed for a recession, some economists say. |
The talks come before finance chiefs from G8 nations meet in Japan in February. | The talks come before finance chiefs from G8 nations meet in Japan in February. |