Truemors
is reporting from
Member
NP Rank:
NP Rank:
China Econ Students Laugh At Geithner's Promise of Strong Dollar
Share:
by Roy C | June 2, 2009 at 12:53 pm
2097 views | 43 Recommendations | 4 comments
Videos
Chinese university students are reported as having laughed at Geithner, the US Secretary of the Treasury, when he promised the Chinese students that Chinese assets in dollars are "safe".
Geithner offered inclusion of China in the IMF as he sought multiple ways to engage China.
One of the lesser reported aspects of the trip was Geithner's talk of change in the exchange rate between the Chinese currency and the US's.
China has been accused of maintaining a "fixed rate" of exchange, with exporters depositing their dollars as dollars in Chinese banks, which creates no demand on the Chinese currency, allowing it to stay low, favoring Chinese exports while disfavoring imports from countries such as the US where China has a huge trade surplus.
Having a free-floating Chinese currency would make Chinese importers and consumers pay less, but it would destroy the value of Chinese dollar-denominated assets.
A weak dollar would undermine Chinese profits, as well.
UPDATE 3-Geithner tells China its dollar assets are safe
Mon Jun 1, 2009 8:03am EDT
* Dollar assets are safe, Geithner assures China
* Recession losing force; U.S., China must alter growth tack
* Backs strong dollar, calls for more flexible yuan
* China says cooperation can boost global confidence
(Adds Chinese Vice-Premier Wang's comments)
By Glenn Somerville
BEIJING, June 1 (Reuters) - U.S. Treasury Secretary Timothy Geithner on Monday reassured the Chinese government that its huge holdings of dollar assets are safe and reaffirmed his faith in a strong U.S. currency.
A major goal of Geithner's maiden visit to China as Treasury chief is to allay concerns that Washington's bulging budget deficit and ultra-loose monetary policy will fan inflation, undermining both the dollar and U.S. bonds.
China is the biggest foreign owner of U.S. Treasury bonds. U.S. data shows that it held $768 billion in Treasuries as of March, but some analysts believe China's total U.S. dollar-denominated investments could be twice as high.
"Chinese assets are very safe," Geithner said in response to a question after a speech at Peking University, where he studied Chinese as a student in the 1980s.
His answer drew loud laughter from his student audience, reflecting scepticism in China about the wisdom of a developing country accumulating a vast stockpile of foreign reserves instead of spending the money to raise living standards at home.
But later in the day, Chinese Vice Premier Wang Qishan said it was important for the two nations to show the world they are working together through their joint economic dialogue.
"We must through our dialogue send a clear signal that China and the U.S. are engaged in practical cooperation to address the crisis," Wang told Geithner, according to the Chinese Foreign Ministry's website (www.mfa.gov.cn).
"This is important for boosting confidence and encouraging global financial stability and economic revival," said Wang....more......
What is NowPublic?
NowPublic lets people work together to cover news events around the world.
Crowd Power
Roy C
Vancouver, Washington, United States
Related Stories
Recommendations (43)
Amy Judd
Vancouver, Canada
albertacowpoke
Canada
israeli.agent
India
QueensHart
boston, USA., United States
Anonymous user
Rhonda J Mangus
North Tonawanda, New York, United States
Babel-Fish
Negros Oriental, Philippines
djermano
Somewherein, China
Paschen
Narita, Chiba, Japan
nukegingrich
Mccomb, Mississippi, United States
Most RecentMost Recommended Comments (4)
at 13:43 on June 2nd, 2009
Hey Roy , do the chinese know something we do not know.. : )
I surely hope everyone watches this video : Please, Sir, I Want Some More
at 04:07 on June 3rd, 2009
http://my.nowpublic.com/world/china-leads-world-economic-recovery-effort...
Rev. Jermano
at 22:24 on June 10th, 2009
Actual I think the hype went to far, it would seem that many of the larger banks could cover their securities. Remember many of the banks did not want to be bailed out. Many want to pay the money back now.
I think its bad to turn the US flag upside down as many republicans and supporters are trying to do. That everyone should flock around Obama as he really is trying to show the World that America wants peace and how important it is to talk about problems than threat heavy handed.
Where as the patrotism gone? If there ever was any?
at 01:52 on June 11th, 2009
The problem was Bush.....and although there is a new President.....Bush gets away with what he did. We Americans suffer from his contempt, his torture, his lies. America is not about justice when we have a system that can be destroyed by one bad apple, and the new President is unable to apply justice...because there is so much fixing that needs to be done to help the people.. Democracy is not my choice of a government......that works.
Therefore other people have known this way back during the Nixon years, and the idea of patriotism is nothing but pie in the sky BS..... America doesn't work, can't work, and never will work....until we get someone who realizes this and fixes the problem. But they won't...they will carry on with their Lies and BS.
No country has the audacity to never admit their mistakes and not make apology for wrong perceptions. America has never even come close to seeing itself as the impediment to world progress. Everything is material, and anything that has to do with Justice, and winning the peoples heart has been destroyed by those who carry the same torch of corruption, one election after another.
USA; Usual Stupid Abnegation
Rev. Jermano.