G8 Leaders Look for Signs of Recovery

Nations Divided on How To Combat Worst Economic Crisis Since Great Depression

(AP)  Britain and the United States may see room for more stimulus. Germany is worried that it has done too much already.

The leaders of the Group of Eight nations - united in their desire to work together to combat the worst economic crisis since the Depression, but still divided on how much longer they need to keep the stimulus going - will discuss on Wednesday ways to coordinate their exit strategies once their economies are stable enough.

But the data is still grim - from rising unemployment to slowing growth - and most economists think the crisis has yet to reach its nadir.

The leaders of the G8 - Britain, Canada, France, Germany, Italy, Japan, Russia and the United States - will discuss at what point to begin the shift from the current emphasis on fiscal stimulus, but they also are likely to remain cautious in their assessment of recovery so far when they issue a statement later Wednesday.

Both the United States and Europe have posted dismal jobless numbers. Unemployment in the euro zone rising in May to a 10-year high with more than 15 million people out of work. In the United States, the jobless rate jumped to a 26-year high of 9.5 percent in June as U.S. employers cut a larger-than-expected 467,000 jobs. Leaders are fearful that more jobs still could be lost before the crisis bottoms out.

Chinese President Leaves G8 Conference

British Prime Minister Gordon Brown has emphasized that while there are clear signs of recovery - which have included on stronger consumer confidence, housing markets, and retail spending - it is too early to be complacent or to change current policies. He will urge fellow leaders to push ahead with plans to boost the global economy despite suggestions the worst is over, emphasizing the need to continue coordinated international action, a British official said on condition of anonymity.

Brown's five-point plan for the summit includes increasing bank lending, reducing volatility in oil prices, curbing trade protectionism, boosting private investment and safeguarding the jobs of younger people.

U.S. President Obama back in February signed an $787 billion economic stimulus bill in February, but only about 15 percent has made its way into the economy so far - creating a debate between the wait-and-see camp and economists who urge another stimulus, arguing the recession proved to be deeper and more devastating than originally believed.

"The challenge is how much more to put in. They clearly want to wait because you still have 85 percent to hit Americans' wallets and Congress is quite rightly feeling cash-strapped," said John Kirton of the G8 Research Group at the University of Toronto.

Because the impact of stimulus was still being measured, the discussions on possible exit strategies would remain "quite academic," Kirton said. "None of the three largest economies in the world are ready to move on to exit strategies," noting that Chancellor Angela Merkel faces elections in September and stimulus is unpopular among her supporters, while Japan, like the United States, is still waiting to gauge the impact of the last round.

The host Italians are promoting rules and regulations to help prevent future crisis based on a framework laid down at a G8 Finance Minister's meeting last month in Leece and elaborated by the OECD. The 12-common principles aim to create a "strong, fair and clean economy" by fighting tax evasion, protectionism, bribery and money laundering.

France and Britain also want to discuss how to avoid excess fluctuation in oil prices, with a proposal for a price bracket high enough to allow oil companies to continue to invest while preventing prices from going too high.

The leaders will also discuss climate change and development aid later in the afternoon before taking on security issues, including Iran's crackdown on pro-democracy demonstrators and North Korea's recent firing of ballistic missiles into the ocean off its east coast in violation of U.N. resolutions.

[payasyougo]

NAR/NAB - creating a four state housing bubble with the assistance of government. Brought to you mainly by political contributions.

Opportunistic Government - turning a four state housing bubble into a national disaster.

Who is up to bat next?

[skyk-2009]

Now THIS is the kind of thinking that brought us the Most INCOMPETENT, WORST Government in our History.

[noloyalisti]

Totally correct. When you have an aristocratic corporate elite running the media and government of America, you are going to have corruption, greed, waste and bubbles so the rich can prosper.

The G8: a bunch of purchased, greedy, corrupt corporatists giving away the store. Stealing from the poor to give to the rich. Raping and pillaging while extolling the virtues of crony capitalism. Wheeeee!

[bajajohn1]

What no one seems willing to report is why there is such a delay in releasing the stimulus money. Summer is when most construction takes place, so who is sitting on the money?

[debinok1]

Patience young grasshopper, we do not question the wisdom of authority. When we have reached their level of knowledge we will be shown the answers. (Sarcasm intended)

[debinok1]

The Pope wants them to put him in charge. Under his new "Charity of Truth" proposal, all the rich nations will give all of their money to the Pope and the Pope will distribute it around the world evenly to all countries. This of course is just a rough outline of his latest release, but it sums it up pretty well.

[skyk-2009]

Hey maybe you folks can convince the Pope to buy into Trickle Down. That puts all the wealth at the top and in the hands of a very few. It's worked so good for us over the last 3 decades that our nation if falling apart, all our Jobs are in the third World and we went from a balanced budget to record debt. Who could ask for more??

[GiveMeFreedom]

Hey governments, great idea - tax the higher income people - making over $250,000 per year. Of course do not tax George Soros and his friends more as they skate to Switzerland with their piles of our money and avoid tax. They contribute money to the liberals so please leave them alone.

[skyk-2009]

Yep that's the plan. We've given the top 10% all the wealth and now those on the bottom haven't any to spend. Guess what? THEY, not the rich, create jobs and drive the economy.

[thusspokezara]

I have been working too hard for too little money. Time to take it easy and let the government take care of me for a change.

[searingtruth]

"The Republican and Democratic parties have delivered us into the hands of darkness."
SearingTruth

A Future of the Brave