In a new Bush administration initiative that Paulson said is not about "finding excuses and scapegoats," a presidential working group set up in the wake of the 1987 stock market crash is calling for a series of actions designed to avert the kind of chilling housing and credit crunches that are threatening to throw the nation into recession — if it isn't there already.

"The objective here is to get the balance right — regulation needs to catch up with innovation and help restore investor confidence but not go so far as to create new problems, make our markets less efficient or cut off credit to those who need it," said Paulson, who heads the working group.

One recommendation calls for federal and state regulators to strengthen oversight of mortgage lenders and another urges state financial regulators to implement strong nationwide licensing standards for mortgage brokers, according to the group's report, released Thursday.