September 13, 2006
USA to China: "We Want You to Succeed"
Regarding China's currency, the "M" word (manipulation) was never uttered and the only urging on the Yuan was that China include it in the overall reform of the financial system, now underway.
And in a sure sign that Paulson's Treasury won't tango with Schumer-Graham (the moribund China trade war bill sponsored by Senators Charles Schumer (D-NY) and Lindsey Graham (R-SC)(see my previous posts), Paulson said "protectionist policies do not work and the collateral damage from these policies is high. By closing off competition and blocking the forces of change, protectionism reduces the losses of the present by sacrificing the opportunities of the future."
These comments may signal an important shift in China policy but sadly won't be covered much here in America. The Financial Times of London leads with it here.
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