A strange thing happened last week just after Treasury Secretary Tim Geithner delivered his speech on United States–China cooperation at Peking University, in which he claimed a U.S. commitment to debt reduction and increased fiscal responsibility.


Reported the People’s Daily :


“Chinese assets are very safe,” Geithner said in response to a question.



Reported the New York Times :


Following Mr. Geithner’s speech Monday, a student asked the Treasury secretary whether China’s investments in the United States were safe.




He responded without hesitation. “Chinese financial assets are very safe,” Mr. Geithner said, eliciting some laughter. He then quickly said that the United States still had deep and liquid financial markets, and that the administration of President Barack Obama was committed to tackling the deficit and maintaining a strong dollar.



But the Daily Telegraph , Financial Times , and Reuters were more open, reporting “ loud laughter” from the skeptical Chinese audience.


The Gartman Letter reported further on June 3:


The U.S. media avoided any reporting of the laughter that greeted Mr. Geithner’s speech. None of the US television stories reported laughter; none of the U.S. newspapers [other than the New York Times ] reported the laughter; none of the U.S. magazines covering the trip reported the laughter—but the laughter was loud; it was palpable and it was very, very real. Simply put, the U.S. fiscal circumstance has become a laughingstock.



Unlike the foreign-friendly English version of the People’s Daily , a headline from the Chinese version of Xinhua reads simply (by my translation), “Geithner Causes Chinese University Students to Laugh.”


When transparency turns to farce and honest reporting is buried by self-censorship, what other options does one have?


Via Fabius Maximus

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