As President George Bush expressed disappointment over the rejection of the US banking bailout plan, world leaders, including British Prime Minister Gordon Brown, acted to protect their own financial markets.

In Washington last night President George Bush said he was “disappointed” at the US Congress vote rejecting the administration's rescue plan for the nation's financial industry and vowed to "address this economic situation head on."

The president spoke ahead of an emergency strategy meeting at the White House with Treasury Secretary Henry Paulson and other top advisers including Federal Reserve Chairman Ben Bernanke to decide what happens next.

"I'm disappointed in the vote by the United Sates Congress on the economic recovery plan," Mr Bush told reporters during a photo session with the president of Ukraine.

"Our strategy is to continue to address this economic situation head on. We'll be working to develop a strategy."

A grim-faced Mr Paulson, who was seen hurrying into the west wing of the White House, said: “We need to put something back together that works”.

At the Congress, Democratic leaders said the House would reconvene on Thursday in hopes of a quick vote on a reworked version.

“The legislation may have failed; the crisis is still with us,” said House Speaker Nancy Pelosi, a Democrat, in a news conference after the defeat. “What happened today cannot stand.”

In Europe French President Nicolas Sarkozy summonsed bankers to an emergency meeting on Tuesday, while in Britain, Prime Minister Gordon Brown pledged to do “whatever is necessary” to protect the British financial system.

Mr Brown said the failure of George Bush’s rescue plan was “very disappointing” but insisted the British government was taking “decisive action” to tackle problems.

“The vote in America is very disappointing,” Mr Brown said at Downing Street. “The Governor of the Bank of England, the Chancellor and I will take whatever action necessary to ensure continued stability for Britain.

“The stability of our system is something that we are doing everything in our power to maintain.”

In Australia, where the markets dropped over 5 per cent within the first 30 minutes of opening on Tuesday morning, Prime Minister Kevin Rudd called for global pressure to be put on US lawmakers to convince them to put the world's economy ahead of the American presidential race.

Mr Rudd said Australia, along with Britain and European powers, was working to convince US lawmakers to put aside domestic politics and approve a plan that would allow the Treasury Department to buy up toxic assets from struggling banks.

"These are turbulent times, these are worrying times," Mr Rudd said in Canberra.

"What's important is that all people of good will around the world act in concert with our friends in the United States to see the right measures taken through the US political process to stabilise the global financial system.

"The call that we need to make is for them to put aside party politics and to pass this package because it is necessary for the stabilisation of US financial markets and global financial markets," he said. "All of our interests are at stake here."

Back in America, former US President Bill Clinton said he believed that Washington should force America's banks to rewrite mortgages to help struggling borrowers stay in their homes and that the US Government should charge a hefty interest rate for funds loaned to bail-out Wall Street.

Speaking on The Daily Show, an American satirical chat show, the former President said that he believed Washington should model any bail-out scheme on the AIG nationalisation two weeks ago and charge a very high interest rate on any loan. He argued that such a measure would help taxpayers not only recoup their losses but potentially make a profit on the bail-out.

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