McCain offers Rx for market crisis

GREEN BAY, Wis., Sept. 19 (UPI) -- Early intervention and financial transparency are needed to get U.S. financial markets out of crisis, Republican presidential candidate John McCain said Friday.

McCain outlined his prescription for the crisis on Wall Street during a campaign event in Green Bay, Wis.

To deal with the immediate crisis, McCain said he'd create the Mortgage and Financial Institutions trust, which he called "an early intervention program" that would work with the private sector and regulators to identify troubled entities to help them before they become insolvent.

McCain proposed new laws that would prevent financial institutions from "concealing their bad practices."

"An inexcusable lack of financial transparency allowed Wall Street firms to engage in reckless behavior" during good times, the U.S. senator from Arizona said, "but now imperil the financial security of millions of Americans when their bets turned sour."

Regulatory clarity also is needed to hold the financial activity to one regulatory standard, he said.

When failing companies seek taxpayer bailouts, the Treasury Department must follow consistent policies in deciding whether to guarantee loans, he said.

"With billions of dollars in public money at stake, it will not do to keep making it up as we go along," McCain said.

Finally, he said, the Federal Reserve "should get back to its core business of responsibly managing our money supply and inflation."

Blame can be shared and while it may be difficult to pinpoint what set the financial markets tumbling, McCain offered an "educated guess."

"The financial crisis we're living through today started with the corruption and manipulation of our home mortgage system," he said.