Seems topical.

That’s John Cale from his 1992 solo performance memorialized as “Fragments of a Rainy Season.” Great, great presentation of his oeuvre, although the Dylan Thomas material is an acquired taste. The versions of “Cordoba” and “Dying on the Vine” are much better than the studio versions.

Coincidently, John Engler, president of the National Association of Manufacturers, addressed the Chinese envoy question in a response to a reporter’s question Wednesday. Engler said:

It’s long been our position that the Chinese currency is undervalued. I tell you what I’m reluctant to do is give the Congress of the United States a pass on fixing so many issues that are problems for manufacturing and have them try to act as though they’re the Politburo over in China. We’re not the Chinese government.
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The U.S. Treasury Department on Thursday released its semiannual Report to Congress on International Economic and Exchange Rate Policies and concluded that the renminbi remains undervalued, but did not cite China for currency manipulation. The reason, of course, was China’s June 19th announcement that it would allow its exchange rate to be more responsive to market forces. The report went on to say that “What matters is how far and how fast the renminbi appreciates…We will closely and regularly monitor the appreciation of the renminbi.”

The National Association of Manufacturers has long held that the Chinese currency is a major factor in our trade imbalance with China and was a contributing factor to the global imbalances that have yet to be fully righted after the recent financial crisis. We have urged the Administration to engage with our trading partners and use every multilateral opportunity to press China to end its persistent currency undervaluation. We have also worked with our counterpart organizations in other countries to make the same case to their governments.

This is exactly what happened in recent months as governments from around the globe spoke out about the need for China to allow for a more market-determined currency value. Recognizing that is also in its own interest, China took the important step of moving away from its dollar peg in June. But Secretary Geithner is correct — how much China allows the renminbi to appreciate is key. The next Treasury report is due to Congress in October, and that is ample time to see enough movement in the currency to determine if the Chinese government is serious about correcting its significant undervaluation. Treasury is monitoring and we are all watching.

From Radio Free Asia, “China Fears Euro Slide,” reporting on the Chinese government’s protests that the decline in the Euro’s value ties its hand on revaluing its own currency.

Patricia Mears, director of international commercial affairs at the National Association of Manufacturers in Washington, said there will always be new reasons to put off currency reforms.

“They are never going to find a perfect time. There are always going to be conditions that could be of concern to them,” said Mears. “But the reality is the longer they put this off, the more protectionism grows around the world.”

“Basically, the Chinese have got to end this policy,” she said.

In March, 130 members of the U.S. House from both parties urged the Obama administration to slap duties on Chinese goods because of its currency policy. Fourteen senators also sponsored bipartisan legislation that could impose tariffs if China fails to act on the yuan.

Mears said lawmakers are unlikely to be swayed by the euro argument after the United States recorded a $51.7-billion trade deficit with China in the first quarter of the year.

“I think it’s highly unlikely that they’re going to give China a pass,” said Mears.

From a Reuters interview with President Obama earlier in the week in anticipation of his trip to Asia, “Obama: strains unless US, China balance growth“:

[He] warned that the economic relationship between the two countries had become “deeply imbalanced” in recent decades, with a yawning trade gap and huge Chinese holdings of U.S. government debt.

Obama said he would be raising with Chinese leaders the sensitive issue of their yuan currency — which is seen by U.S. industry as significantly undervalued — as one factor contributing to the imbalances.

“As we emerge from an emergency situation, a crisis situation, I believe China will be increasingly interested in finding a model that is sustainable over the long term,” he said. “They have a huge amount of U.S. dollars that they are holding, so our success is important to them.”

“The flipside of that is that if we don’t solve some of these problems, then I think both economically and politically it will put enormous strains on the relationship.”

The Hill had a follow-up story, “Obama to China: Currency and trade imbalances a focal point,” with the NAM’s positive reaction.

I think it is significant he brought this up in an interview and it’s more than a passing comment,” said Pat Mears, who works on China issues for the National Association of Manufacturers. She said U.S. manufacturers don’t expect things to change overnight, but offered hope that China will again allow its currency to appreciate against the dollar, as it did for more than a year before the financial crisis hit in 2008.

And new stories on the cusp of his departure today.

• BBC News,”Obama leaves for Asia trade drive”
• The Associated Press, “Obama faces daunting challenges in Far East tour”
• Wall Street Journal, “An Agenda for Obama in China
• Asia Times Online, “China trade surplus shadows Obama visit“

Politico, “Barack Obama’s China plan looks like George W. Bush’s.” The story delivers what the headline promises.

Frank Vargo, the NAM’s vice president for international economic affairs, commented on the context of Treasury Secretary Geithner’s trip given the current state of play:

Now more than ever, the two economies need each other,” said one observer from the business community. “The administration recognizes they need to maintain the right posture.”

And with markets already skittish, signs of significant tension between the two countries would have dire consequences for the global economy, said Frank Vargo, vice president for international economic affairs at the National Association of Manufacturers.

“Everybody’s looking at United States and China as really being the two principal players on the global economic scene. So if they start shouting at each other, this is bad for financial markets right now,” he said. “You’ve just got to be careful. It doesn’t mean you change your objectives.”

And from an earlier AP story, “Geithner wields little leverage in China talks“:

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The New York Times reports that Tim Geithner, the nominee to be U.S. Secretary of Treasury, said in written responses to Senate Finance Committee inquiries that he believed China manipulates its currency. From the story, “Geithner Hints at Harder Line on China Trade“:

“President Obama — backed by the conclusions of a broad range of economists — believes that China is manipulating its currency,” Mr. Geithner wrote. He stopped short of charging that China is manipulating its currency intentionally to gain an unfair trade advantage, as the 1988 law requires for an official citation of currency “manipulation.”

The Times considers this page one news, seeing it as indication of a harder policy line against China’s economic policy. The NAM’s Frank Vargo, vice president for international economic policy, comments:

The National Association of Manufacturers, whose members have pushed previous administrations to get tougher with China, was pleased, but also cautious given the potential for a confrontation that could exacerbate global woes.

“You know the world has changed a lot with the financial crisis and China has a lot in U.S. Treasuries,” said Frank Vargo, vice president for international economic affairs at the manufacturers’ association. “This needs to be done in a cooperative, not a confrontational, way.”

 You would certainly hate to see President Obama repeat the mistakes of President Hoover and sign legislation that sparks a destructive round of protectionism worldwide.

UPDATE (9:45 a.m.): Wall Street Journal also reports, “U.S. Stance on the Yuan Gets Tougher“:

“You don’t want to be the bull in the China shop when it comes to currencies right now,” said Frank Vargo, a vice president of the National Association of Manufacturers, which has long lobbied against China’s yuan policy. “But…we all know the Chinese currency is deliberately undervalued

Or, as the new year dawns, ox in the China shop.