U.S. Treasury Secretary Henry Paulson sounded an upbeat note on the world economy Monday, despite the recent turmoil roiling the markets. Paulson's remarks came during a trip to Paris. Lisa Bryant has more from the French capital.

Following a morning meeting with his French counterpart Christine Laguarde, the U.S. Treasury Secretary cautioned against against any quick decisions for more market regulation. He said the world's economic underpinnings remained financially sound - despite turmoil in capital markets that began in the United States.

"Although this will be with us for a while - it's going to take a while to work through this turbulence in the capital markets - we're doing so against a backdrop of a strong global economy," he said. "And unlike certain periods of turbulence we've gone through in the past that have been precipitated by the real economy - issues that have been precipitated by bad lending practices - we'll work through this in some markets quicker than in others (and) we're already seeing a modest reduction in the strain in certain markets."

Secretary Henry Paulson's remarks come as Europeans worry the current market turmoil may have a longer-term impact on their banks and on the region's economic prospects. French and German leaders want to increase market transparency as a result.

The U.S. Treasury Secretary also spoke positively about the candidacy of former French finance minister Dominique Strauss-Kahn as the new head of the International Monetary Fund.

"I very much appreciated his views. He's a very strong candidate and I look forward in the weeks ahead that this election process be finalized," he said. "So again, I'm very positive on Dominique Strauss-Kahn."

Paulson was to discuss Strauss-Kahn's bid during a meeting later Monday with French President Nicolas Sarkozy. The I.M.F. head is traditionally a European, although European Union officials say they might consider a non-European candidate in the future.