All The BS from Timothy Geithner

I read this bunch of BS by Timothy Geithner (US Treasury Secretary) on 18 October 2010, on his way to G20 "hot-air" meeting in Korea.

Geithner Vows US Will Not Devalue Dollar

Published: Monday, 18 Oct 2010 | 6:46 PM

"... "It is not going to happen in this country." Geithner told Silicon Valley business leaders of devaluing the dollar. ..."

"... On Friday, the dollar index hit a 10-month low against a basket of major currencies, while the greenback has been plumbing fresh 15-year lows against Japan's yen. ..."

"... Geithner said in Palo Alto that he believes China will continue to lift the value of its yuan currency to aid the rebalancing of its economy away from exports and toward domestic growth.

Asked how much higher China should allow the yuan to rise, Geithner said: "Higher."

"You can't know how far it should go. What you know now is that it's significantly undervalued which I think they acknowledge and it's better for them, and of course very important for us, that it move. And I think it's going to continue to move," Geithner said. ..."

He can really talk BS - If the Yuan is undervalued, and is to appreciate against the US dollar, then the US dollar will drop. How does that make a STRONG US DOLLAR?

So, the US did not devalue, but other countries revalued. So the end result is a lower US Dollar, BUT don't blame him (or the US), they didn't devalue!!

Yesterday's Reuters Report gave even more BS from Timothy Geithner:

"... He reiterated that he wants to see China to accelerate its move toward a market-determined exchange rate.

"China is well into a very promising and very ambitious program of domestic reforms to strengthen domestic growth because China recognized that it cannot afford to rely as it has in the past on such an export-dependent model for growth," Geithner told a news conference. "We want to see that progress continue."

"Of course as a part of that, it's not ready for its exchange rate to rise more rapidly in response to market forces," Geithner added of China. ..."

He said that China was instituting domestic reforms to up growth (domestic consumption) so he said China was NOT ready for its exchange rate to rise rapidly (cannot appreciate fast).

So he wanted a STRONG DOLLAR, but also wanted the Yuan to APPRECIATE (= weak dollar), but also said that the Yuan was not ready to appreciate .

No wonder at the G20 meeting, the German Economy Minister said that the US was the one manipulating the exchange rate!

As expected the meeting ended with the usual meaningless communique:

"... In a final statement after two days of heated negotiation, the G20 said it would “move towards more market-determined exchange rate systems” and that the International Monetary Fund would “deepen” its supervision of exchange rates. ..."

Then:

"... While several member countries of the G20 hailed the summit in South Korea as a success, Japan immediately broke ranks to declare that, contrary to the spirit of the communique, it would continue to devalue the yen if it saw fit. ..."