Tim Geithner: China's Bumbling Nephew... and What's This Yuan-Denominated T-bill Business?

Tim Geithner is little more than chief pimp for U.S. debt and as such, it makes sense that he must provide the sort of hoes that the tricks on the street (in this case, the Chinese) want providing their backseat half-and-half. (If you aren't familiar with the term, I recommend The Best Cathouses in Nevada, which I once picked up from a Wendover truck stop for a little cross country light reading - consider yourself forewarned, I have never looked at humanity quite the same since) Point being, if Timmy doesn't have a market for his tramps, he better get back to the Hoe Depot and pick up some bitches that will get some play out there. Are you listening, Timmy?

I have heard others mention this as more than just a wild idea birthed by the bears who insist the sky is falling. The sky is still falling, we're still bears, and you never know just how far this administration will go to monetize everything that isn't nailed down.

Market Oracle

The tables are fast turning against the deeply indebted USGovt officials. USA Inc is in deep trouble. Its productive engines in both finance and industry are either wrecked or sputtering, even as its debt burden grows exponentially. Debt default litters the landscape. Next its sovereign bonds will be have to be sold to some extent outside the US$ Sphere, which will put at great risk its stock, namely the USDollar itself. Let’s call them USGovt Dragon Bonds.

The custodians desperately seek creditors to supply much needed capital in order to fund the gigantic and growing USGovt debts, which by the way are grossly understated. The last resort is to monetize the USTreasury Bond issuance, a process well along. With the aid of the USDollar Swap Facility, the USFed has been able to secretly bid on USTBonds from foreign soil, have it appear like foreign bids, and conceal the continued and broadening monetization initiative. The United States is boldly defying the creditor nations, printing money, and buying its own debt. When more fully revealed, the USDollar will suffer the consequences. A sense of betrayal will surely come, much like discovery that the CIA has been flooding the globe with counterfeit $100 bills, or Wall Street has been flooding the globe with counterfeit Fannie Mae Bonds. Closer to home, it is akin to selling lemonade has been secretly watered down, or putting lawn mower clippings into the reefer batch before sale.

The frightening part is that we, as debtors, have turned the knife in our foreign creditors' backs before, repeatedly, and with the sort of self-important narcissism that makes one feel guilty for having indulged in so much baseball and apple pie. Is this the America that we call home? Have things always been like this?

Of course, I do not have that answer.

Lucky for us, Tim Geithner's Chinese "Uncle" does, and if this doesn't set off the red flags, I might as well give up and go find a new hobby:

Vice Premier Wang Qishan said of U.S. Secretary of Treasury Timothy Geithner: "I could be his uncle." His comment aroused an emotional response from Chinese attendees at a dinner last night near The White House in his honor and in State Councilor Dai Bingguo's honor. With tight security, the dinner drew elite leaders from in government, business, civic affairs and ChinaStakes. Sponsorship included a long list of organizations and individuals but primary sponsorship came from the US-China Business Council and the National Committee on US-China Relations.

American attendees did not catch the punch line of "uncle" until receiving informal explanations later from Chinese attendees.

Prior to his "uncle" remarks, Vice Premier Wang had told the audience that when he was a student, he went to see Peter F. Geithner, the father of Secretary Timothy Geithner, who was with The Ford Foundation for 28 years and the foundation's first representative in Beijing. The Vice Premier asked the Secretary's father for financial assistance to complete his studies. Geithner gave the Vice Premier financial support for studying ocean waves.

American attendees later learned that "Uncle" is a common and widely used Chinese expression when a son or daughter addresses a colleague of one's father. Vice Premier Wang's dramatic expression drove home the following message: US Secretary Geithner and I have a personal relationship ("guanxi") which distinguishes success from failure. Our relationship is not an ordinary relationship. We are family. We can build a successful US-China relationship because of our "guanxi." An "uncle" relationship has greater advantages than a purely formal business relationship.

Of course. Perhaps Geithner should borrow a few US dollars from his uncle for the next time reporters go sniffing at the contents of his wallet?

This is beyond disturbing. Your Treasury Secretary is selling you on China's street corner for far less than you are worth, America, and if you put on the short skirt and CFM boots to walk his streets, I guess you deserve to get banged on the back of a Beijing bicycle. Just sayin.

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


Anonymous said...

>This is beyond disturbing. Your Treasury Secretary is selling you on China's street corner for far less than you are worth, America, and if you put on the short skirt and CFM boots to walk his streets, I guess you deserve to get banged on the back of a Beijing bicycle. Just sayin. <

Relax Jr. This is nothing but whitewash for a broken down old fence. To suggest the chinese would be irrational enough to shelve their long term plans just to pursue a warm and fuzzy relationship with TurboTim really does assume they are either children or idiots.

As far as what the USA is pledging to the Chinese in order to keep the current paradigm in place, well I think Mr. P started that whole trend before and Turbo is just the guy with a broken broom who is told to sweep up the shards of glass as best he can.

Regarding Yuan bonds, that comes from a certain Mr Willie who writes a newsletter. He has a theory of newsletter writing, if he just makes enough predictions, eventually a few will come true.

Which is a common failing among self trained (myself included) analysts.


Sorry, it's been a long weekend.

And isn't that what pushing the shards around is? Corralling the hoes? I know China doesn't buy it, it's the fact he's doing it in the first place that is disturbing me.

As for broken clocks, I think we've all been guilty of that. As is anyone who has read "The Secret"

Did you see our boy Larry Summers on Meet the Press? Shifty-eyed, vague, babbling. Who is buying this? Someone has to be.

That's my point. We're still getting paraded around the block and someone is still buying.

Anonymous said...

>And isn't that what pushing the shards around is? Corralling the hoes?<

Absolutely, if that happens to be their long term objective.

I think you are realistic enough to understand a vendor financing scheme can only drive sales for a
limited duration. At some point the vendor needs some of the
financed cash to return so that operations can be funded.

In this case, the Chinese have been accepting IOU's and are in the process of exchanging those IOU's for new and larger ones, notably of decreasing duration.

It's my opinion. founded on no real tangibles, that the Chinese really don't want the large chunk of America that the emerging consensus seems to think they do. I think they are going to allow
US politicians to paint your economy and social structure
into an inescapable corner and only then will the Chinese
present the bill. It will be a small island southeast of mainland China, populated by alot of Chinese. And, another 1938 style Munich Conference could very well decide that for the good of the world, this island should return
to the mainland where it [allegedly] belongs.

Are the Chinese prepared to spend this much to reclaim this part of their perceived territory? For a largely bloodless conquest I am afraid the answer is yes.

While your fears are well reasoned, and just as likely to be correct as my opinions might, I don't feel the Chinese are either benevolent or malevolent but maintain a benign neutral posture and are willing, at times, to break that posture in order to guide their endgame in the right direction as necessary.

In your position, I would be more concerned for the people who really think that this current structure can continue and there will be no consequences. Those people will not be able to cope at all with the coming new reality.

>Did you see our boy Larry Summers on Meet the Press?<

No, I have better things to do on a Sun morning like raking up the yard. I did read the summation on the Automatic Earth though, and I gather I didn't miss a lot.

>Who is buying this? Someone has to be.<

More showmanship. The herd is being prepared for the next migration coming perhaps as soon as this fall. So the herd must be steered into the general direction of the pen so that the roundup can happen more easily. Earlier, I mentioned that I feared GS has the next crash already 'up their sleeve' so to speak. I keep to that view at the moment.

Reminds me of the comment that one could pick out 535 names at random from a phone book and get better government than the electoral process produces.... lol.

Anonymous said...

>Who is buying this? Someone has to be.<

Sorry I just remembered this. I saw a utube vid over the weekend and it was from Gov. Jesse Ventura and he mentioned that politics was like professional wrestling - all the disagreements one witnesses in public don't mean much when they are in reality good friends backstage.

I respect Jesse as an unimpeachable source and if he says there isn't a lot of difference between WWE and real politics then I accept that as true.

So who actually believes the interviews of Mr Summers? The "Marks" do [the non-smart pro wrestling fans as referred to by the insiders].