Geithner in China: Global economy is improving, but more work to do

In China this morning, U.S. Treasury Secretary Timothy Geithner stated that the United States and China must change strategies on how to boost economic growth as consumer demand fades. Geithner told the students at Peking University, "China is already too important to the global economy not to have a full seat at the international table." He also said that the global recession is easing but is still "powerful and dangerous" in much of the world.

Secretary Geithner's comments came at the school where he studied Chinese in the '80s and where he is kicking off his overseas trip. Geithner restated pledges made by the Obama administration that it will cut its huge fiscal deficits, which have worried China, the leading buyer of U.S. Treasury debt. Geithner also promised "very disciplined" future spending, even hinting at a reintroduction of pay-as-you-go budget rules. These comments came as Beijing periodical Global Times (ITALICS) published a survey of Chinese economists indicating that big holdings of U.S. debt are "risky." The country's concerns focus on the belief that rising U.S. debt could push U.S. interest rates higher and weaken the value of dollar-denominated debt.