China sounding skeptical about GM

Scott Tong Jun 1, 2009
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China sounding skeptical about GM

Scott Tong Jun 1, 2009
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Steve Chiotakis: Treasury Secretary Tim Geithner already talked a little about it today in China. Geithner says the takeover. From Shanghai, Marketplace’s Scott Tong has that.


Scott Tong: Geithner told a crowd at Peking University the U.S. government is just a temporary caretaker for General Motors. He said he expects GM to emerge quickly from bankruptcy stronger, and eventually move on without government assistance.

Timothy Geithner: Our objective is to make sure we’re limiting our involvement, the minimum necessary, and that we get out of that involvement as quickly as we can.

Since that involvement means the government putting another $30 billion into GM, the upshot is more borrowing and a bigger and shakier budget deficit.

Which doesn’t sit well with China. It’s invested a trillion dollars in U.S. bonds and wants assurances they’re secure. In Beijing today, Geithner said Chinese financial assets in the U.S. are “very safe.” At which point some members of the audience reportedly laughed.

In Shanghai, I’m Scott Tong for Marketplace.

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