As the Federal Reserve looks to quickly implement the $700 billion rescue plan, the Bush administration is weighing taking ownership stakes in several U.S. banks to try to calm global financial markets, the Associated Press reported.

The bailout package passed by Congress last week gives the Treasury Department authority to inject fresh capital into financial institutions in exchange for ownership shares.

A formal decision on how to implement the plan has not been made yet, but at a news conference yesterday Treasury Secretary Henry Paulson said, “We will use all the tools we’ve been given to maximum effectiveness, including strengthening the capitalization of financial institutions of every size.”

The discussion comes after fear about the global economy caused central banks in England, China, Canada, Sweden and Switzerland and the European Central Bank to cut rates along with the Federal Reserve’s half-point cut on its benchmark rate to 1.5 percent.

Markets began to improve this morning, with the Nikkei 225 index in Japan trading up 1.25 percent after it fell 9.4 percent yesterday, its biggest one-day drop in 21 years. European markets also began to recover as Britain announced a 500-billion-pound ($865 billion) rescue plan that involves pouring cash into troubled banks in exchange for ownership in them.

Meanwhile, Iceland suspended trading on its stock exchange for two days and took control of its largest bank as the financial crisis threatened its entire economy and other European nations, where tens of thousands of people have accounts with Icelandic bank subsidiaries.

The Dow Jones industrial average was up this morning after falling 189 points yesterday, but by 10:55 a.m. it was down 58 points to 9,200.05. It is down about 35 percent from its peak of 14,164.53 hit exactly one year ago.