The United States will continue to repair the balance sheets of strategic financial institutions by exchanging liquid assets for illiquid ones, while the Europeans will be guaranteeing interbank loans. The most important message appears to be that, aside from gestures of coordination, each nation is following its own plan.

Essentially, it appears that the G-7 and G-20 meetings in Washington on Saturday did not achieve a comprehensive strategy. A European Union summit brought in all eurozone members — leaving out, among many others, the British, who announced their own plans. The eurozone countries agreed to uniform principles for dealing with the crisis, based around loan guarantees, but they are not going to administer these measures centrally. Each state is going to administer its own programs—using its own resources.

In other words, the crisis has internationalized, but the solution has not. In fairness, there are no international institutions that have the administrative depth to coordinate a global rescue operation, but that does not mean that there could not have been a uniform understanding on strategy. The split between the American approach and the European approach is striking, as is the national administration within the eurozone. And this raises an interesting question.

The most important banks are global in nature. They are chartered in the state of New York and in Europe. We assume that the new European guarantees are open to any bank that is allowed to operate in Europe, and that American capital infusions are open to any financial institution operating in the United States. So, assuming that Morgan Stanley borrows money in Europe, will that be guaranteed — and can Morgan Stanley then turn around and borrow money from the U.S. government as well? Globalism raises some interesting questions: Exactly how does a global bailout work without a global perspective?

The truth is that no one really knows. The U.S. government is still struggling with how to administer its programs, with Congress considering returning after the elections (in three weeks) to enact new legislation. The Europeans are planning other meetings later this week on how to implement the program, and French President Nicolas Sarkozy said, “We must convince our American friends of the necessity of an international summit to review the international financial system.” This implies that the United States doesn’t want to review the international system — an interesting point in itself.

In any case, we are at an intriguing transition point. Governments are planning massive interventions in an attempt to control the financial markets. They have committed to this strategy, but they haven’t organized the intervention quite yet. Therefore, for the moment, there is still a free market. That means that banks are free to lend or — as we are now seeing — not to lend to each other, and the equity markets are free to draw whatever conclusion they wish.

The issue is whether the decision to intervene in a generally specified way will add enough confidence to the system to free up lending. It is not clear that there will be any retroactive support. Will everyone therefore refrain from lending until government financing and guarantees are in place?

The announcements have been decisive, but details are not nailed down and won’t be for several days at least. Even when they are in place, the management of the international dimension of the crisis remains unclear. We had wondered whether equity trading would be suspended for several days while these things are worked out, and that apparently isn’t happening. So what we have is a global commitment to guarantee aspects of the financial system, at least temporarily, with a variety of modalities to be used. But there is no administrative structure in place, nor are many critical questions answered. One question has been answered: There will be international coordination, but not an integrated international solution.

The one thing that comes out of all this is that nationalism has trumped globalism.