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Posts Tagged ‘Geithner’

Geithner denies dollar manipulation, slams Greenspan

In Uncategorized on November 12, 2010 at 4:52 am

Geithner in China for talks on economic ties

In Uncategorized on October 25, 2010 at 9:35 am

US Treasury Secretary Timothy Geithner held talks with his Chinese counterpart Sunday on economic ties amid tensions over China’s currency, which Washington believes is undervalued.


Geithner met Vice Premier Wang Qishan in the eastern coastal city of Qingdao a day after a Group of 20 finance ministers meeting wrapped up in South Korea.


Washington has long argued that China’s currency, the yuan, is being kept grossly undervalued in order to help Chinese exporters.


Beijing counters that loose US monetary policy is driving down the dollar and causing a wave of capital to flood emerging markets in search of higher yields.

US Treasury Secretary Timothy Geithner, pictured on October 23, held talks with his Chinese counterpart Sunday on economic ties amid tensions over China’s currency, which Washington believes is undervalued.

The G20 talks ended on Saturday with an agreement to avoid tit-for-tat currency devaluations and aim for “more market-determined exchange rate systems”.


Following the Geithner-Wang talks, the US Embassy released a statement saying they “exchanged views on US-China economic relations”, without giving further details.


But in an interview conducted ahead of the meeting, Geithner said he believed China would let the yuan appreciate.


“They recognise it’s important to the world. China recognises that and I think we’re going to see them continue to move,” he told Bloomberg Television, in comments published Sunday.


The US Treasury chief said that China had some way to go in loosening its grip on the yuan, Bloomberg reported.


“But I think they’re committed to do that, because they recognise it’s in their interest,” the channel quoted him as saying.


Beijing has bristled at criticism from Washington about the value of the yuan, which some lawmakers have charged is undervalued by as much as 40 percent, giving Chinese exporters an unfair trade advantage.


US President Barack Obama is likely to meet Chinese President Hu Jintao on the sidelines of the G20 summit in Seoul from November 11-12. Obama is scheduled to attend the meeting, but Hu’s attendance has not been officially announced.


In a statement released on Saturday, Geithner said the G20 meeting agreed that a “gradual appreciation” in the currencies of major trade-surplus nations was required.


“Countries with significantly undervalued exchange rates committed to move towards more market-determined exchange-rate systems that reflect economic fundamentals, as China is now doing,” Geithner said in the statement.


But further efforts to stabilise international economic imbalances were necessary if the recovery from the global financial crisis was going to be successful, he added.


“This requires a shift in growth strategies by countries that have traditionally run large trade and current account surpluses, away from export dependence and toward stronger domestic demand-led growth,” Geithner said.


“This entails a range of policy changes, as you can see in the very broad range of domestic reforms being undertaken by China.”


Geithner was scheduled to return to the United States Sunday following his talks with Wang, US officials said.

Last week, China announced that Hu would visit the United States in January next year, as the world’s top two economies seek a way to sort through a host of disputes.

The US trade deficit with China ballooned to a new record in August, sharply widening the overall trade gap, according to official US data released this month.

The two sides are also at odds over a series of trade disputes and human rights issues, such as the case of jailed dissident Liu Xiaobo, who was awarded the 2010 Nobel Peace Prize, sparking Beijing’s anger and Washington’s praise.

Source: SGGP

Geithner in China for talks on economic ties

In Uncategorized on October 24, 2010 at 7:54 am

BEIJING, Oct 24, 2010 (AFP) – US Treasury Secretary Timothy Geithner held talks with his Chinese counterpart Sunday on economic ties, likely touching on the thorny issue of China’s currency, which Washington believes is undervalued.


Geithner met Vice Premier Wang Qishan in the eastern coastal city of Qingdao a day after a Group of 20 finance ministers meeting wrapped up in South Korea, a US official said.


“The two sides exchanged views on US-China economic relations and the preparation for the (G-20) leaders summit in Seoul,” a statement released by the US Embassy said following the talks.


US President Barack Obama is likely to meet Chinese President Hu Jintao on the sidelines of the summit in Seoul from November 11-12. Obama is scheduled to attend the meeting, but Hu’s attendance has not been officially announced.


US officials refused to detail the specifics of the Geithner-Wang talks, but they likely included China’s currency, the yuan, which Washington believes is being kept grossly undervalued in order to help Chinese exporters.

US Treasury Secretary Timothy Geithner arrives at a press conference following the G20 Finance Ministers and Central Bank Governors meeting in Gyeongju, S. Korea on October 23, 2010. AFP

China counters that irresponsibly loose US monetary policy is driving down the dollar and causing a wave of capital to flood emerging markets in search of higher yields.


In a statement released Saturday, the US Treasury chief said the G20 meeting agreed that a “gradual appreciation” in the currencies of major trade-surplus nations was required.


“Countries with significantly undervalued exchange rates committed to move towards more market-determined exchange-rate systems that reflect economic fundamentals, as China is now doing,” Geithner said in a statement.


But further efforts to stabilise international economic imbalances were necessary if the recovery from the global financial crisis was going to be successful, he added.


“This requires a shift in growth strategies by countries that have traditionally run large trade and current account surpluses, away from export dependence and toward stronger domestic demand-led growth,” Geithner said.


“This entails a range of policy changes, as you can see in the very broad range of domestic reforms being undertaken by China.”


Geithner was scheduled to return to the United States Sunday following his talks with Wang, US officials said.


Last week, China announced that Hu would visit the United States in January next year, as the world’s top two economies seek a way to sort through a host of disputes.


Beijing has bristled at criticism from Washington about the value of the Chinese yuan, which some lawmakers have charged is undervalued by as much as 40 percent, giving Chinese exporters an unfair trade advantage.


The US trade deficit with China ballooned to a new record in August, sharply widening the overall trade gap, according to official US data released this month.

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Source: SGGP

‘No risk’ of currency war: Geithner

In Uncategorized on October 13, 2010 at 8:10 am

There is “no risk” of a global currency war erupting, despite recent currency interventions by nations ranging from Japan to Colombia, US Treasury Secretary Timothy Geithner has said.


Geithner acknowledged in an interview on “The Charlie Rose Show” broadcast on Bloomberg TV that Brazil has made reference to the possibility, but he brushed aside fears.


“They used that phrase,” Geithner said. However “there is no risk of that.” Geithner’s comments came despite a failure this weekend by the world’s top finance officials meeting in Washington to reach a consensus on measures that could head off a potential currency battle.

A Chinese bank worker counts US dollar notes alongside stacks of 100-yuan notes in central China’s Anhui province

In a statement, the International Monetary and Financial Committee — the policy arm of the IMF — on Saturday stopped short of any specific call on China or others to change policies of using a low currency and accumulation of reserves to boost exports.


The International Monetary Fund steering committee, which has been struggling to address friction among key economies including China and the United States, noted “tensions and vulnerabilities” due to “widening global imbalances” but said the organization should continue to study the situation


Geithner on Saturday said the IMF “must strengthen its surveillance of exchange rate policies and reserve accumulation practices,” adding that “excess reserve accumulation on a global scale is leading to serious distortions in the international monetary and financial system.”


Recent IMF figures showed Beijing had currency reserves of 2.447 trillion dollars, the largest in the world and nearly 30 percent of the global total.


Washington maintains that China purchases large amounts of dollars to keep the yuan artificially low, which distorts global trade by boosting Chinese exports.

Source: SGGP

US must support flagging housing market: Geithner

In Uncategorized on August 18, 2010 at 7:24 am

Timothy Geithner

WASHINGTON (AFP) – US Treasury Secretary Timothy Geithner said Tuesday that the government must bolster the embattled American housing sector to avoid more damaging recessions in the future.


“Without such support, the risk is that future recessions could be more severe because the financial system would not have the capital to support mortgage lending on an adequate scale,” he said.


“House price declines could be more acute, with even greater damage to financial wealth and economic security,” Geithner said at a conference in Washington on the future of housing finance in the United States.


A key issue is how to reform troubled mortgage giants Fannie Mae and Freddie Mac, which were taken over by the federal government at the height of the financial crisis in 2008 as their loan losses mounted.


Their portfolios of mortgage-backed securities snowballed to more than 1.6 trillion dollars at their peak without the financial resources to cover potential losses.


Since the takeover, the government has injected more than 140 billion dollars into the two companies, which own or guarantee more than half the 11 trillion dollar US residential debt market.


Geithner said fixing the damaged US housing finance system was “one of the most consequential and complicated economic policy problems we face as a country.”


He made it clear that the government “will not support” returning Fannie and Freddie to their previous role in which they fought to take market share from private competitors while enjoying the privilege of government support.


The Obama administration has vowed to deliver to lawmakers a comprehensive housing finance reform proposal by January 2011, beyond November elections.


Obama and his Democratic allies have already come under fierce attack from Republicans for not including Fannie Mae and Freddie Mac in a sweeping financial overall that was signed into law recently.


Reforming Fannie and Freddie is political charged as the housing sector struggles to emerge from the mortgage crisis that plunged the economy into a recession in 2007.


The two firms have underpinned the US housing market for 40 years, and — supporters argue — have made housing affordable for millions of poorer Americans.


Critics say they represent unwarranted government interference in the housing market.


Geithner recalled that the financial crisis saw a “full retreat” by private financial institutions from many forms of mortgage and consumer lending.


This “provides a compelling illustration of why private markets, left to their own devices, find it hard to resolve financial crises,” he said.


Geithner said the government’s role in providing stability to the housing finance system, both in times of prosperity and during downturns, was key to economic stability.


“This question is really about whether the government — in order to make sure that Americans can borrow at reasonable interest rates to buy a house even in a downturn — has to provide a form of guarantee or insurance against losses,” he said.


Some governments make insurance or guarantees explicit while many leave them implicit or hidden, Geithner said, adding that the jury was still out on what the extent of US government involvement should be.


“It’s safe to say there’s no clear consensus yet on how best to design a new system,” he said.

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Source: SGGP