Chinese President Hu Jinatao, in preparing for a trip to the U.S. this week, made seemingly passing comments on the Fed, lack of regulation of the U.S. financial system, and the waning status of the Dollar as the global currency. From the Wall Street Journal yesterday:
He said that U.S. monetary policy “has a major impact on global liquidity and capital flows and therefore, the liquidity of the U.S. dollar should be kept at a reasonable and stable level.” . . .
Mr. Hu reiterated China’s belief that the crisis reflected “the absence of regulation in financial innovation” and the failure of international financial institutions “to fully reflect the changing status of developing countries in the world economy and finance.” He called for an international financial system that is more “fair, just, inclusive and well-managed.” . . .
“The current international currency system is the product of the past,” he said, noting the primacy of the U.S. dollar as a reserve currency and its use in international trade and investment.
“fair and just?” Those are just keywords he picked up reading American mainstream media. Then whammo “well-managed.”
Ohh yeah! Well! You can’t talk about my mother like that!
When I put aside my natural feelings of cheerleading for my team and the indignation I am supposed to feel when a foreign leader takes veiled swipes at the U.S., these remarks strike me as measured and on the mark.