    [Public Papers of the Presidents of the United States: George W. Bush (2008, Book II)]
    [November 15, 2008]
    [Pages 1372-1375]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks at the Summit on Financial Markets and the World Economy
    November 15, 2008

        Welcome. Good afternoon. We just had a very productive summit
    meeting. Thinking about 3 weeks ago, when I was talking to President
    Sarkozy and Barroso at Camp David--some of you were there--I don't think we
    could have predicted then how productive and how successful this meeting
    would have been.
        The first decision I had to make was who was coming to the meeting.
    And obviously, I decided that we ought to have
    G-20 nations, as opposed to the G-8 or the G-13. But once you make the
    decision to have the G-20, then the fundamental question is, with that
    many nations, from six different continents, who all represent different
    stages of economic development,

    [[Page 1373]]

    would it be possible to reach agreements, and not only agreements, would
    it be possible to reach agreements that were substantive? And I'm
    pleased to report the answer to that question was, absolutely.
        One of the things we did, we spent time talking about the actions
    that we have taken. The United States has taken some extraordinary
    measures. Those of you who have followed my career know that I'm a free
    market person, until you're told that if you don't take decisive
    measures then it's conceivable that our country could go into depression
    greater than the Great Depression. So my administration has taken
    significant measures to deal with a credit crisis. And then we worked
    with Congress to deal with the credit crisis as well.
        And we're beginning to see some positive results. One of the things
    people around the table were interested in is, are you beginning to see
    the results of your actions? And our credit markets are beginning to
    thaw, having been severely frozen; businesses are beginning to get
    access to short-term credit. It's going to take more time for the
    measures we have put in place to take hold. No question about that. As a
    matter of fact, we just started, for example, on the $700 billion fund,
    to start getting money out to our banks. So it's going to take more
    time.
        But I was pleased to tell the folks around the table that the
    significant actions we've taken are beginning to work. All of us
    committed to continue to work on progrowth economic policies. It's
    phrased different ways--fiscal plans--but the whole point was, was that
    we recognize that, on the one hand, there's been a severe credit crisis,
    and on the other hand, our economies are being hit very hard. And so
    there was a common understanding that all of us should promote progrowth
    economic policy.
        We also talked about broader reforms. So, in other words, the
    discussions were focused on today and what we're doing about it, but
    what are we going to do to make sure it doesn't happen tomorrow.
        One of the key achievements was to establish certain principles and
    to take certain actions for adapting our financial systems to the
    realities of the 21st century. A lot of the regulatory structures that
    are in place were 20th-century regulatory structures. And obviously, you
    know, the financial industry went way beyond them. And the question is,
    how do we establish good regulatory structure without destroying the
    incentive to innovate, without destroying the marketplace?
        Our nations agree that we must make the markets--the financial
    markets more transparent and accountable. Transparency is very important
    so that investors and regulators are able to know the truth. Considered
    improving accounting rules, so that investors can understand the true
    value of the assets they purchase. We agree that we need to improve our
    regulations and to ensure that markets, firms, and financial products
    are subject to proper regulation and oversight.
        For example, credit default swaps, financial products that ensure
    against potential losses, should be processed through centralized
    clearinghouses. That's a significant reform. Heretofore, the credit
    default swaps were traded in over-the-counter, unregulated markets.
        Yesterday the Working Group on Financial Markets, which is obviously
    associated with the White House, announced an initiative to create these
    kinds of clearinghouses. And I know that other nations are working on
    them as well. This process will help expedite credit default swaps and
    other types of instruments not being traded in unregulated, over-the-
    counter markets. By bringing greater stability to this important sector,
    we will help with liquidity, but also mitigate risk.
        Third, we agreed that we must enhance the integrity of the financial
    markets. For example, authorities in every nation should take a fresh
    look at the rules governing market manipulation and fraud to make sure
    that investors in all our countries are

    [[Page 1374]]

    properly protected. We agree that we must strengthen cooperation among
    the world's financial authorities. There was a lot of discussion about
    the International Monetary Fund and the World Bank, for example.
        Leading nations should make regulations consistent. As well, we
    should reform the international financial institutions. Again, these
    institutions have been very important--the World Bank, IMF--but they
    were based on an economic order of 1944. And so, to better--we agreed
    that to better reflect the realities of today's global economy, both IMF
    and World Bank should modernize their governance structures. They ought
    to consider extending greater voter--voting power and representation to
    developing nations, particularly those who have increased their
    contributions to the institutions.
        All this is an important first step. In other words, this is the
    beginning of a series of meetings. People say, ``Well, why don't you
    have one meeting and, you know, call it `Bretton Woods II'?'' Well,
    Bretton Woods I took 2 years to prepare. I don't know what you want to
    call this one, but whatever name comes from this meeting, it took 3
    weeks to prepare. And so it makes sense to come out of here with a firm
    action plan, which we have.
        It also makes sense to say to people that there is more work to be
    done, and there will be further meetings, sending a clear signal that a
    meeting is not going to solve the world's problems. A meeting will help
    begin a process so that we can say over time that we will have a
    regulatory structure in place that will make this less likely to happen
    in the future.
        And so we've directed our finance ministers to work with other
    experts and consult with officials in other economies and then report
    back to the leaders with detailed recommendations. Whatever we do,
    whatever reforms are recommended, we need to be guided by the--this
    simple fact: That the best way to solve our problems and solve the
    people's problems is for there to be economic growth. And the surest
    path to that growth is free market capitalism.
        Leaders at this summit agreed on some other matters of importance.
    One is to reject protectionism and refrain from erecting new trade
    barriers. This is a very important part of this summit. The temptations
    in times of economic stress will be to say: ``Oh, trade isn't worth it.
    Let's just throw up protective barriers.'' And yet that attitude was
    rejected, thankfully. And matter of fact, not only rejected, there is a
    determined effort to see if we can't complete the modalities for Doha by
    the end of December.
        One of the things I stressed as well is that the United States, in
    the midst of this financial crisis, will not abandon our commitments to
    people in the developing world; that the HIV/AIDS initiative known as
    PEPFAR will remain strong and vibrant; that our deep desire to
    significantly reduce malaria deaths in countries on the continent of
    Africa will not be diminished; that our obligation to help feed the
    hungry will not stop; that in the midst of all this turmoil and
    financial crisis, we will meet our obligations. These obligations are in
    our national security interests and our economic security interests, and
    they in--are in our moral interests.
        And so I will tell you that I thought this was a very successful
    summit. And they're going to meet again. I keep saying ``they'' because
    some of you may not have heard yet, but I am retiring. But I told the
    leaders this: That President-elect Obama's
    transition team has been fully briefed on what we intended to do here at
    this meeting. I told them that we will work tirelessly to make sure the
    transition between my administration and his administration is seamless.
    And I told them that I hope he succeeds, that it's good for our country
    that people see a peaceful transfer of power. And I hope it was good for
    them to hear that even though we're from different political parties,
    that I believe it's in our country's interest that he succeed.

    [[Page 1375]]

        So I want to thank you for giving me a chance to come and visit with
    you. Thanks for covering this summit. Goodbye.

    Note: The President spoke at 2:11 p.m. at the National Building Museum.
    In his remarks, he referred to President Nicolas Sarkozy of France, in
    his capacity as President of the European Council; and President Jose
    Manuel Durao Barroso of the European Commission. The Office of the Press
    Secretary also released a Spanish language transcript of these remarks.