US President Obama Discussed G20 London Summit

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President Obama held a press conference hours after the G20 Summit was adjourned on Apr. 2, to discuss the results with the international press before engaging in the Q&A with the reporters.

He discussed the consensus that was achieved by the G20 members to unite in creating united jobs, stimulate the global economy, to assist emerging economies to remain viable, and to encourage trade that would benefit the involved nations.

"Earlier today, we finished a very productive summit that will be, I believe, a turning point in our pursuit of global economic recovery.  By any measure, the London summit was historic.  It was historic because of the size and the scope of the challenges that we face, and because of the timeliness and magnitude of our response."  United States President Barack Obama

Right on cue, in New York, the Dow jumped above 8,000 for the first time since two months as investors are feeling confident enough to buy stocks again. 

There were some key factors that contributed to the rally, namely the financial stocks getting a boost after the Financial Accounting Standards Board relaxed the accounting rules that forced banks to value their assets at current prices - the mark-to-market rules.  In other words, this change helps the banks to reduce their losses.  Additionally, factory orders posted a large increase in February, followed by the pending home sales increase, manufacturing activities, and auto sales report.  

This news could not be anymore timely for President Obama as the G20 Summit closed on Apr.2.  President Obama declared the Summit a success even when he did not come away with a globally coordinated fiscal stimulus that all participants would underwrite. In other words, Mr. Obama did not get a concrete promise from others for substantial increases in government domestic spending, a tool that he has used to boost the U.S. economy.

Some excerpts of the President's remarks during the press conference:
 
Today, we've learned the lessons of history. I know that in the days leading up to the summit, some of you in the press, some commentators, confused honest and open debate with irreconcilable differences. But after weeks of preparation, and two days of careful negotiation, we have agreed on a series of unprecedented steps to restore growth and prevent a crisis like this from happening again.

The President went on to discuss one of the central topics of the G20 Summit, namely the coordinated and fundamental reform of the financial regulatory systems:
 
To prevent future crises, we agreed to increased transparency and capital protections for financial institutions. We're extending supervision to all systemically important institutions, markets and products, including hedge funds. We'll identify jurisdictions that fail to cooperate, including tax havens, and take action to defend our financial system. We will reestablish the Financial Stability Forum with a stronger mandate. And we will reform and expand the IMF and World Bank so they are more efficient, effective and representative.

Some excerpts from President Obama's Q&A session:
 
Q:    Chuck Todd.  "Mr. President, what concrete items that you got out of this G20 can you tell the American people back home who are hurting, the family struggling, seeing their retirement go down, or worrying about losing their job -- what happened here today that helps that family back home in the heartland?"
 
President Obama:  "Well, as I said before, we've got a global economy, and if we're taking actions in isolation in the United States, but those actions are contradicted overseas, then we're only going to be halfway effective -- maybe not even half.
 
You've seen, for example, a drastic decline in U.S. exports over the last several months.  You look at a company like Caterpillar, in my home state of Illinois, which up until last year was doing extraordinarily well; in fact, export growth was what had sustained it even after the recession had begun.  As a consequence of the world recession, and the contagion from the financial markets debilitating the economies elsewhere, Caterpillar is now in very bad shape.  So if we want to get Caterpillar back on its feet, if we want to get all those export companies back on their feet, so that they are hiring, putting people back to work, putting money in people's pockets, we've got to make sure that the global economy as a whole is successful."

Q:    Justin Webb, BBC. "Mr. President, In the spirit of openness, with which you say you're going to run your administration, could you give us an insight into an area or areas where you came to London wanting something and you didn't get it; where you compromised, where you gave something away to achieve the wider breakthrough agreement?"

President Obama:  "Well, I think that if you look at the language of the document, there are probably some areas where it wasn't so much of a sacrifice as it might not have been our number-one priority, but it became clear that it was very important to certain other actors.

I'd rather not specify what those precise items would be, because this is a collective document.  But there's no doubt that each country has its own quirks and own particular issues that a leader may decide is really, really important; something that is non-negotiable for them.

I think that this kind of coordination really is historic.  I said in the meeting that if you had imagined 10 years ago, or 20 years ago, or 30 years ago, that you'd have the leaders of Germany, France, China, Russia, Brazil, South Africa, a President of the United States named Obama -- former adversaries, in some cases former mortal enemies, negotiating this swiftly on behalf of fixing the global economy, you would have said, that's crazy.  And yet it was happening, and it happened with relatively little -- relatively few hiccups.  

And obviously the actions that each of us take in our individual countries are still absolutely vital.  So we have a set of principles, for example, around dealing with systemic risk that I think will be very important in preventing the kinds of financial crises that we've seen.

That does not entirely solve the problem of toxic assets that are still in U.S. banks and certain British banks and certain European banks.  And how each individual nation acts to deal with that is still going to be vitally important.  How well we execute the respective stimulus programs around the world is going to be very important.  The quicker they are, the more effective they are at actually boosting demand, the more all of us will benefit."

The full text of the Questions and Answers session can be read here.

Next on President Obama's schedule is a visit to the French-German border, Strasbourg and Kehl and Baden-Baden on Apr. 3, where he will join other NATO leaders at a summit marking the 60th anniversary of the North Atlantic Treaty Organization (NATO). 

Sources:  

• The Financial Accounting Standards Board

• The White House, Office of the Press Secretary, United States

• G20 London Summit

Previous G20 Related Article by this Writer:

• High Security for Mr. Obama's Packed Diplomacy: G20, NATO, & EU

• G-20 Ministers Vowed To Tackle Global Financial Crisis