( Wall Street Journal)

MARCH 13, 2009

Wen Voices Concern Over China's U.S. Treasurys

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By ANDREW BATSON and ANDREW BROWNE

Associated Press

Premier Wen Jiabao, right, said China is concerned about the value of its U.S. Treasury holdings.

BEIJING -- Premier Wen Jiabao voiced confidence in China's economy, saying his government's finances give it room to spend even more to support growth if needed, but expressed concern about the outlook for the U.S. and the safety of its Treasury bonds.

The forceful comments from Mr. Wen's annual press conference -- a rare opportunity for domestic and foreign reporters to ask a top Chinese official questions directly -- helped depress the U.S. dollar and prices of U.S. Treasurys in Asian trading Friday.

The public airing of his concerns reflect how the relationship between China and the U.S. has been evolving under the pressure of the financial crisis. For years the U.S. has pressed China to change the way it runs its economy, such as by opening up its financial system. But in the last year China's government has been increasingly vocal about what it sees as U.S. economic mismanagement. And as the U.S. government's largest creditor, it has become more assertive in trying to ensure its interests receive a hearing.

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"We have lent a huge amount of money to the U.S., so of course we are concerned about the safety of our assets. Frankly speaking, I do have some worries," Mr. Wen said in response to a question. He did not offer specific suggestions on economic policy to the U.S. government, but called on it to "maintain its credibility, honor its commitments and guarantee the security of Chinese assets."

Mr. Wen did indicate that China would not be rash in making changes to its $1.946 trillion stockpile of foreign reserves, much of which is in U.S. dollars. While China is naturally looking out for its own interests, it will "at the same time also take international financial stability into consideration, because the two are inter-related," he said.

In that vein, Mr. Wen also pointed out that China hasn't pushed down the value of the yuan, despite pressure on its exporters, and repeated his government's commitment to currency stability. The yuan has hovered around 6.84 to the dollar since July 2008, but Mr. Wen noted that because the dollar has risen against other Asian and European currencies, the yuan has actually become stronger overall.

He said China alone would decide where the yuan goes from here. "No country can pressure us to appreciate or depreciate" the currency, he said.

Despite the rising external challenges, Mr. Wen reaffirmed his belief that China should be able meet its traditional target of economic growth of around 8% this year. He said market expectations last week of another stimulus package were based on "rumors and misunderstandings," and that China's announced program of four trillion yuan in investments over two years will help meet "both short-term and long-term needs."

China's government is planning on an eightfold expansion of its budget deficit this year, to around 3% of gross domestic product, to fund the stimulus program. Mr. Wen said government debt remained at a manageable level and that conservative budgeting in previous years means China is well positioned to do more if necessary.

"We have already prepared plans to deal with greater difficulties, and have reserved adequate ammunition. We can introduce new stimulus policies at any time," he said.

Mr. Wen said that China is also closely watching to see the effects of the policies taken by U.S. President Barack Obama aimed at returning the world's largest economy to health. Chinese foreign minister Yang Jiechi was also in Washington this week to discuss how the two countries can cooperate on economic policy, among other issues.

A test of that cooperation is quickly approaching. U.S. Treasury Secretary Timothy Geithner this week called on the Group of 20 – a gathering of the world's largest developed and developing economies – to increase funding for the International Monetary Fund by up to $500 billion to help combat the financial crisis. Achieving that sum likely will depend on getting agreement from countries that hold large foreign exchange reserves, such as China and Saudi Arabia.

Ahead of a preparatory meeting of G-20 financial officials this weekend near London, Mr. Wen said pointedly that "increased funding for the IMF is not a question for just one country" but for all member nations. He also repeated China's desire to see reforms to the IMF that give more clout to developing nations.

The Chinese premier's annual press conference is held each March at the close of the country's legislative session. Mr. Wen was asked about a broad range of subjects, from relations with France and Russia to the possibility of political reform in China and the sensitive issue of Tibet.

Mr. Wen used harsh language against the Dalai Lama, Tibet's spiritual leader, who accused the Chinese government this week of turning the Himalayan region into a "hell on earth." He said talks between Beijing and the Dalai Lama, which took place last year without making any progress, could only resume if the Dalai Lama is "sincere."

Despite blanket security in Tibet around the 50th anniversary of the Dalai Lama's flight from Tibet, Mr. Wen said that "the situation in Tibet on the whole is stable. The Tibetan people hope to live and work in peace and stability."

Adventure some $ to profit from the Range/Frequency. Set STOP Gain/Loss, based on your experience/discipline. SHORT Calls could stand better chance,probability wise.

Caution here. On top of the gains up to 1/20, base on his advice, stop-gain would be needed( to sell shorts),unless, you can stomach the risk to ride it higher on this surf/swing.

To have war? with whom?

打仗, winner takes all.

For desperado, jump in the could- be pseudo-bottom and to take some extra risks. For bravado,choose the investments/fields you are more comfortable with and start building up portfolio GRADUALLY, Not in haste yet(unless you are momentum player/Day trader); otherwise, stay put and try to learn from this period of history(probably at least from 1970s) to decipher the underlining fabrics/scheme in the background. It helps to be one of The CHOSEN PAIRS (like voyage experience?!)elevating self to the High Ground in the next round of the DELUGE.

Fine tune your personal style, either in Investing,or in your LIFE. Wish luck.

Don't keep your surplus money under pillows. Without spending, how can economy revive?

Sanitary is clean up you shit.

Those frequent swings count in days,weeks,and a few rounds of movements could mean many times of the % gains mentioned. You DON't have to be a day trader to practice it. They are people inclined to GAME it, and that behavior could be too risky for we ordinary not wired in that kind of mentality.

Disclaimer: Never write for profit, and that keeps this advice on higher ground in Objectivity . To stay DRY also served /deemed a good policy in the era of this DELUGE.

For people with high risk tolerance/appetit, small investors can try ETF's(ultra SHORT if you think the market heads down), set Stop Gain(5%,10% ?,or even 20% if the momentum /trend is clearer in your judgement) . Because of the big swings of the market in the past year, and the situation is expected to continue for quite some time in 2009, now maybe is a opportune time to exercise this strategy. Best of all, it won't require much expertise doing it. A little bit discipline and Economics ABC will do.

So I ain't gonna save or invest any more.

I'll spend all my money till the day I drop.

As such, I keep the economy rolling.

真正的專家說過：＂投機比投資好＂

因為投機能掌握經濟勢頭．隨時隨地都有危機意識

不過份貪心能見好就收

因此投機能逃過金融災難

投資？

是懶人守株待兔法

成天只想坐以待＂幣＂，結果到最後過份樂觀以致失去危機意識

就變成坐以待＂斃＂了

有這樣睿言慧語的專家是誰？

請網友千萬記住！

一定要把我文大人算上一份！