Today, Treasury Secretary Tim Geithner issued a statement following a meeting of the G-20 Finance Ministers and Central Bank Governors. Secretary Geithner stated that the purpose of the meeting was to develop a comprehensive set of recommendations for next month’s G-20 meeting on the global financial crisis. He noted that there was a “strong consensus on the need for both recovery and reform so that we never face a crisis like this again.”
In order to recover from the financial crisis, Secretary Geithner indicated that there was a group consensus that the following is needed:
- Large scale, sustained commitment to macroeconomic stimulus and growth policies;
- Aggressive actions to fix financial systems and make credit available; and
- Substantial support of emerging markets and developing economies from international financial institutions.
With respect to reform, Secretary Geithner stated that a “common framework of concrete change to the international financial architecture” was agreed upon. Specifically, the framework includes:
- A stronger framework of oversight and clearer rules enforced evenly and consistently from country to country;
- Standards for stability and disclosure for all markets, including the derivatives market;
- A stronger cushion of stability via capital requirements and accounting standards; and
- Financial market integrity.
Secretary Geithner also stated that the membership of the Financial Stability Forum was expanded to permit the collaboration necessary to develop strong regulatory and supervisory policies.
The recommendations generally track those set forth by Secretary Geithner in advance of Saturday’s meeting of the G-20 Finance Ministers and Central Bank Governors.