EU leaders thrash out $2.7 trillion bailout plan

Leaders from the 27-nation European Union are meeting Wednesday and Thursday in the hope further agreement on their approaches will give markets more confidence.

Sharemarkets started easing back Wednesday after two days of large gains prompted by Britain, Germany, France, and the U.S.'s banking bailouts worth more than $3 trillion.

They, along with the Netherlands, Spain and Austria, have agreed to buy shares in banks and pump huge sums of money into lending markets in an effort to restore confidence and make credit readily available again.

The EU meeting was originally meant to discuss climate change but the economic crisis was expected to dominate.

Before the meeting, British Prime Minister Gordon Brown, who urged other countries to take shares in banks, said the world had to work together to solve the economic crisis and action be taken to construct a new regulatory framework. Brown said measures to tackle climate change could be an integral part of plans to boost economies.

European Commission head Jose Manuel Barroso has called for supervision of hedge funds and private equity, and action against "short-termism" and "perverse incentives."

Prime Minister Gordon Brown will on Wednesday urge Europe to follow up action to revive the banking system with changes to the architecture of the financial system to avoid a repeat of the credit crunch.

Many countries are following Britain's lead in pumping taxpayers' money into banks to restore confidence, alongside big injections of liquidity into markets and underwriting lending between banks.

But Brown, eager to build on a growing reputation at home and abroad as a policymaker at the frontline of the financial crisis, told reporters on Tuesday that the international community must go further