Governments on both sides of the Atlantic took radical steps to restore confidence in battered financial markets on Thursday, as the United States proposed a taxpayer-funded mopping up of toxic mortgage-related debt and Britain cracked down on short selling of bank stocks. The impact was immediate and dramatic, driving the U.S. stock market up by its biggest percentage gain in six years, powering a rally in the dollar, and pushing oil prices higher, while the gold price slipped. Asian stocks also rallied. U.S. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke plan to work through the weekend with Congress on a plan to deal with toxic bank assets choking the financial system. They met with Congressional leaders on Thursday night but did not talk directly about a fund afterwards."We talked about a comprehensive approach that will require legislation to deal with illiquid assets on financial institutions' balance sheets," Paulson told reporters. According to two Congressional aides, he has been shopping around a plan to create the fund. Rep. Barney Frank, who is chairman of the House Financial Services Committee, said there is concern that establishing a formal entity to buy the assets would take too long. U.S. authorities have already pledged $900 billion to prop up the financial system and housing market. The UK ban on short selling came after the U.S. Securities and Exchange Commission introduced rules under which short sellers and broker-dealers must deliver stock by the end of business on settlement day, three days after the sale. Morgan Stanley boss John Mack told employees at a town meeting he thought U.S. regulators were starting to understand the systemic risk posed by short sellers. Cuomo put short sellers on notice. "I want the short-sellers to know today that I am watching," he said. In a sign of the growing blame game arising from the crisis, Republican presidential hopeful Sen. John McCain called for the resignation of the SEC's Cox, a fellow Republican.