George Bush: There are challenges, but Americans have reason to be confident

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The Independent Online

Over the past few days, we have witnessed a startling drop in the stock market – much of it driven by uncertainty and fear. Here's what the American people need to know: The Federal Government has a comprehensive strategy and the tools necessary to address the challenges in our economy.

Here are the problems we face and the steps we are taking: First, key markets are not functioning because there is a lack of liquidity. So the Federal Reserve has injected hundreds of billions of dollars into the system. The Fed has joined with central banks around the world to co-ordinate a cut in interest rates.

Second, some Americans are concerned about whether their money is safe. So the Federal Deposit Insurance Corporation and the National Credit Union Administration have significantly expanded the amount of money insured in savings accounts and checking accounts and certificates of deposit.

Third, we are concerned that some investors could take advantage of the crisis to illegally manipulate the stock market. So the Securities and Exchange Commission is launching rigorous enforcement actions to detect fraud and manipulation.

Fourth, the decline in the housing market. My administration launched the Hope Now Alliance, which brings together homeowners and lenders and mortgage services to find ways to prevent foreclosure. These actions are helping to address a key problem in the housing market: The supply of homes now exceeds demand. Once supply and demand balance out, our housing market will be able to recover.

Fifth, we have seen that problems in the financial system are not isolated to the United States. Today, I'm meeting with the finance ministers from our partners in the G7 and the heads of the World Bank and the International Monetary Fund.

Finally, American businesses and consumers are struggling to obtain credit. So my administration worked with Congress to pass a $700bn financial rescue package. This new law authorises the Treasury Department to use a variety of measures to help banks rebuild capital. In the short term, we'll continue to face challenges. But in the long run, Americans have reason to be confident.

Taken from the President's weekly radio address to the nation