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World's Stock Markets Plunge
A trader on the floor of the New York Stock Exchange watches as investors joined a sell-off around the world. The Dow fell 369.88 points yesterday, to 9950.50.
(By Richard Drew -- Associated Press)
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"In taking these measures, European leaders recognize the necessity of tight coordination and cooperation," Sarkozy said.
Finance ministers from the 15 eurozone countries -- those whose currency is the euro -- meeting in Luxembourg issued a statement Monday essentially affirming the statement from Sarkozy.
It was the second time in two days that Sarkozy had proclaimed European unity when the reality seemed much different.
Sarkozy has called for a coordinated continent-wide response to the crisis but could not win agreement for such a plan at a summit Saturday in Paris with the leaders of Britain, Germany and Italy; he said after that meeting that while nations would respond individually, they would act "in a coordinated way."
But, as the French newspaper Le Monde commented on its Web site Monday, "the facade of unity lasted less than a weekend."
Officials at the summit had been critical of Ireland, which last week guaranteed all deposits in the country's six largest banks without consulting its neighbors. Banks in other European countries complained that the move could create unfair competition and cause depositors to switch to Irish banks.
On Sunday, German Chancellor Angela Merkel, who had been critical of Ireland's action, created massive confusion in Europe by appearing to say that Germany would guarantee all $786 billion in German bank deposits. "We want to tell savers that their deposits are safe," Merkel said. "The government will vouch for that."
Speaking in the British Parliament on Monday, Darling tried to calm the confusion created by Merkel's statement by calling it a "political declaration" that was not "legally binding."
Iceland, Denmark and Sweden, meanwhile, announced special deposit protection plans Monday, joining Greece, Spain and Austria. Britain last week announced it was raising the amount of insured deposits.
In his much-awaited Parliament speech, Darling stressed he would do "whatever is necessary to maintain stability" in financial markets. He gave no details.
"The one option Darling didn't have was to do nothing, but apparently he thought that was an option," said Alex Potter, a banking analyst at Collins Stewart in London. Potter said Darling's assertion that he would keep "all options open" was "laughable."
"It's all very nice he is having meetings -- but we need to see him do something," Potter said, adding that Europe's fragmented approach to the crisis had an "incredibly damaging" impact on markets Monday.
