LYNN NEARY, host:
Housing troubles are also hitting the U.K. A new report shows that nearly half a million cash-strapped British homeowners have missed a mortgage payment in the past six months. It's adding to worries about Britain's economy.
Today, top European leaders meet in London for an unusual gathering aimed at responding to all the turmoil in the markets and fears over the U.S. economy.
The heads of Europe's four biggest economies - France, Germany, Italy and Britain - are expected to appeal for calm and discuss ways to improve how financial markets operate.
From London, Rob Gifford reports.
ROB GIFFORD: Today's summit was called by Britain's Prime Minister Gordon Brown before the events of last week. Now, following the slide on global stock markets and the news of a rogue trader at French bank Societe Generale, the meeting seems even more important. It's all part of the British government's proposal for change in international financial institutions while still keeping individual institutions accountable.
British Finance Secretary Alistair Darling.
Chancellor ALISTAIR DARLING (Finance Secretary, Great Britain): The primary responsibility for all these things, whether or not it's a decision to lend to somebody in a house in America or to keep the books properly in your bank, must lie with the board of directors. But you've got to make sure that across the world we have an adequate supervisory regime. And frankly, the problem we've got just now is that many of the structures we have like the IMF, for example, were designed in the aftermath of the Second World War for a completely different world.
GIFFORD: All four governments have reasons to act and to be seen to be doing so at home. Some economists are predicting a recession in Britain, and Alistair Darling and Gordon Brown are still picking up the pieces after the first run on a British bank in more than a century.
A major German bank also had to be rescued last year after problems resulting from exposure to the subprime meltdown in the U.S., and France is reeling from the losses at Societe Generale. Leaders are today expected to call for more transparency in financial markets, new arrangements for credit ratings agencies, and better coordination between national regulators.
The question is, though, can a meeting such as today's produce concrete achievements, and is more regulation actually what is needed?
David Llewellyn, professor of money and banking at Loughborough University, thinks not.
Professor DAVID LLEWELLYN (Loughborough University): It's very seductive to think let's regulate and that will solve the problem. It also seems to have the advantage to ministers that they are then seen to be doing something. In my experience, it is usually not the correct approach. First of all, the problems are usually not because of a regulatory failure, and secondly, regulation often simply doesn't work. Financial markets are just too complicated to regulate in fine detail.
GIFFORD: That is the more traditional British, if not European, viewpoint, that less regulation is good. Gordon Brown's suggestions that a little more might be in order will perhaps raise hopes that today will lead to some concrete results. But getting agreement on many things in Europe continues to be difficult because of such competing national agendas.
As recently as last December, Britain vetoed Italian proposals that the supervision of financial markets be based on one set of rule standards across Europe. Many observers are hoping that the risk of a continent-wide recession will help to focus minds today on more European cooperation.
Rob Gifford, NPR News, London.