G-20 Agrees to Spend $1.1 Trillion

At its annual meeting in London, the leaders of the world’s largest and most important economies agreed to a range of fiscal and regulatory steps in the hope of combating the worldwide economic recession. Prime Minister Gordon Brown of Britain announced that the leaders had committed to US$1.1 trillion in loans and guarantees to finance worldwide trade while also helping to bail out troubled economies.

“This is the day the world came together to fight against the global recession,” Mr. Brown declared. “Our message today is clear and certain: we believe global problems require global solutions.”

The new financial regulations include new rules for hedge funds and ratings agencies and a crackdown on tax havens. The Group of 20 also agreed on rules to cap the pay and bonuses of bankers and to apply a common approach to the toxic assets that currently sit on the balance sheets of some of the world’s largest banks.

The G-20 pledged to triple the resources of the International Monetary Fund to $750 billion. This will help aid countries that are in trouble economically and the world’s poorest economies.