Empty-handed Bush pulls out some optimism

His approval ratings hover at a record low, his credibility is close to zero and he'll be out of office in three months. But George Bush's address to the nation yesterday underlines how, despite everything, he is a key figure in a financial crisis that is no longer measured in months but in days and even hours.

The market collapse requires a co-ordinated international solution, of which an outline may emerge from the discussions of ministers and central bank governors of G7 industrial countries at the IMF annual meeting here. The role of the US will be crucial.

"We're in this together and we'll come through this together," Mr Bush said. The US was "working closely with our partners from around the world" to stabilise panic-stricken markets. "Fellow citizens, we can solve this crisis, and we will."

Unfortunately however, Mr Bush, who will meet the G7 ministers today, had little that was new to offer.

The administration was moving "aggressively" to contain the crisis, he said, insisting that the $700bn (£412bn) bank bailout passed by Congress last week was enough.

But experts say the approved process, whereby Treasury will buy untradeable mortgage-based assets held by banks – is too slow and the package too little. US officials admit it will be a month before the mechanism kicks in.

Economists want the US to follow Britain's lead and offer to pump capital directly into banks in return for an equity stake and blanket guarantees to encourage banks to lend again. Treasury officials hint that they are ready to do so.

Some experts say even that will not be sufficient. They call for a massive government stimulus to the economy and a public works programme to prevent manageable recession turning into depression.

In his address yesterday, Mr Bush said markets were being driven by fear. The US was "a prosperous nation with immense resources". As they watch their investments shrivel, Americans can only hope that optimism is justified.