G-20 Calls for Action on Growth, Overhaul of Financial Rules

G-20 Calls for Action on Growth, Overhaul of Financial Rules

By Michael McKee and Simon Kennedy
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Nov. 16 (Bloomberg) — Leaders from the biggest developed and emerging nations agreed to further steps to shore up a global economy sliding into recession, and laid out regulatory proposals to prevent a recurrence of the financial crisis.

The Group of 20 yesterday urged a “broader policy response,” citing the potential for additional interest-rate cuts and fiscal stimulus, in a statement after meeting in Washington. The group set a March deadline for recommendations on strengthening accounting standards, derivatives markets and oversight of hedge funds and debt-rating companies.

The call for an overhaul of the world financial industry indicates leaders want future expansions to be smoother than the boom and bust of this decade. A lack of any specific pledges to stimulate growth may disappoint some investors, analysts said.

“This isn’t a strong action statement on addressing the matters at hand,” said Carl Weinberg, chief economist at High Frequency Economics Ltd. in Valhalla, New York. Markets may be vulnerable after the weekend meeting because there was no clear pledge for coordinated tax and interest-rate cuts, he said.

Rather than take the same steps together, nations should act “as deemed appropriate to domestic conditions,” the leaders said in their statement. more

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