We’ve all done it.? You’ve been introduced to someone, but forget his or her name.? And so you spend the rest of the conversation studiously avoiding needing to refer to your new friend by name.? Well, as far as I can gather, the same thing happened on Wednesday to Treasury Secretary Tim Geithner.? He gave?a talk at Brookings that was?all about China, but if you didn’t know better, you could be forgiven for thinking he had forgotten her name.
Geithner is an impressive guy.? But perhaps this talk was more interesting for its linguistics than its economics.? Play spot-the-China-euphemism as we wander through his speech:
- He began by noting that “there must also be a change in?the pattern of global growth.”
- “For too long, many?countries oriented their economies toward producing for export rather than consuming at home, counting on the United States to import many more of their goods and services than they bought of ours.”
- And: “countries overly reliant on exports to us for their own growth will need to change their policies”
- “Countries that chronically run large surpluses need to undertake policies that will boost their domestic demand.”
- “it is very important to see more progress by?the major emerging economies to more flexible, more market-oriented exchange rate systems”
- “This is particularly important for?those countries whose currencies are significantly undervalued.?”
- “This is a problem because when?large economies with undervalued exchange rates act to keep the currency from appreciating, that encourages other countries to do the same.”
- And then: “emerging economies individually will be less likely to move, unless they are confident other countries would move with them.”
- He then spoke of “the need… to encourage?economies running current account surpluses to abandon export-oriented policies, let their currencies appreciate, and strengthen domestic demand.”
- He then turned to the IMF “calling on the Fund to issue reports on countries with ‘scarce currencies’–what today we would call countries running persistent surpluses.”
- This is required because of “the threat to global financial stability posed by?persistent, large surpluses.”
- “we agreed to give?emerging economies a greater stake in the most important institutions for economic and financial cooperation.”
- But this is at risk, because of “the limited extent of progress… in?the surplus countries and by the extent of foreign exchange intervention as countries with undervalued currencies lean against the pressures for appreciation.”
- Reform to the IMF will “give the?fastest growing emerging economies greater weight.”
- But this reform “needs to be accompanied by more progress in encouraging countries, particularly?the surplus countries, to pursue more market-oriented exchange rate policies and policies that will reduce reliance on exports and strengthen domestic demand.”
Hmmm… which country is a “major emerging economy” and is one of “the fastest growing emerging economies” that is “overly reliant on exports” and “whose currencies are significantly undervalued,” and is one of those “large economies with undervalued exchange rates,” “scarce currencies” and “export-oriented policies” which ensures that “the surplus countries” are “running current account surpluses” which are “persistent, large surpluses”?
About the only thing he didn’t do is call for economic reform from “countries which recently hosted the Olympics.”
Tim: It’s spelled C-H-I-N-A.