Friday, January 21, 2011

Can Tim avoid a trade war

Timothy Geithner was sitting in his spacious Treasury Department office overlooking the White House earlier this month, mulling the U.S.'s sometimes testy relationship with China. The view wasn't great: China was flexing its military muscles, sticking to a hard line on the valuation of its currency and generally making everyone in Washington jumpy as the state visit by President Hu Jintao approached. Is a trade war possible? Geithner was asked. "A very low probability," he replied, "and I think it's completely avoidable.


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