Wednesday, March 31, 2010

Geithner Courts the Steelworker Vote

On Wednesday morning, Treasury Secretary Geithner will travel to Pittsburgh to tour an Allegheny Technologies Incorporated steel plant and meet with workers and management "to discuss the critical role that innovation and new technology plays in maintaining the competitiveness of the U.S. manufacturing sector." 
Following the tour of the ATI plant, Secretary Geithner will visit the United Steelworkers (USW) headquarters to meet privately with labor and business leaders to discuss the state of the economy and "the importance of America’s manufacturing sector."
He will also hold a media availability at the conclusion of his trip.
In the evening, Secretary Geithner will return to Washington, D.C.

1 comment:

  1. The visit to the steel plant and use of the phrase "the importance of America's manufacturing sector" virtually assures that China will be declared a currency violator by the Secretary of the Treasury on or before April 15, 2009.

    Gary Dorsch in article Greenspan Signals Warnings For Bubble-maniacs .... relates that there could be a torrent of T-bond sales by Beijing, if the US-Congress can marshal a veto-proof majority, for a fast track bill in May, to slap tariffs on Chinese imports, if Beijing continues to keep the yuan "misaligned" with the US-dollar.

    He presents a chart showing how the Chinese have basically sold their currency short to aid exports -- they yuan fell from $8.2 to $6.8 from 2003 to current while exports rose from $24 billion to $94 billion.

    Mr. Dorsch goes on to provide information on the China Currency Bill realting: "My belief is that China will not do anything unless they're required to, and every day we wait is a day we lose wealth, we lose economic advantage, we lose jobs," said New York Senator Charles Schumer on March 23rd.

    Senator Lindsey Graham, a South Carolina Republican, said he agreed quick congressional action was needed because China's currency reforms are frozen in suspended animation. "I think our pressure is going to make a difference, not only to China, but to the administration," Schumer said. "At the end of the day, China is too big to be allowed to have this under-valued currency advantage. The only thing they seem to respond to is pressure," Graham said.

    "The US internal and external deficits remain large, and its unemployment rate is extremely high. Since US politicians don't want to blame themselves, the best available scapegoat is China and its exchange rate," said Fan Gang, of the People's Bank of China on March 26th. Yet Fan conceded, that China may resume a managed float of the yuan, once the uncertainty of the overall post-crisis economic situation diminishes," he said.

    Yet a stronger Chinese yuan could fuel a generalized rally in the commodity markets, and ignite a whole new round of inflation worldwide.

    The last sentenced translated into plain English means that gold prices are likely to go higher, much higher.

    I believe Mr Geithner has an end objective in mind, that being to create chaos, for out of chaos comes order, specifically a "unified regulation of global banking"