threaten to label China a "currency manipulator" and Beijing threatens to dump its U.S. debt holdings.
Then, with the imminent approach of a major inflection point - be it a key international summit or major financial report - both sides grudgingly agree that a modest appreciation of the yuan would be mutually beneficial.
However, things could be slightly different this time around. China has routinely ducked calls to revalue its currency, and in doing so greatly agitated the West.
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What's In a Name: Can the U.S. Afford to Call China a Currency Manipulator?
Why the Yuan Won't Be an Issue at the U.S. China Summit
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The last Strategic and Economic Dialogue between the world's largest and third-largest economies was riddled with bickering over currencies and the placing of blame for the global recession. However, officials on both sides of the Pacific this time around have taken a more tempered approach in the hopes that more productive talks will emerge.
U.S. officials will undoubtedly make addressing the value of the yuan a priority, but if the meeting's cordial opening is any indication, they will do so humbly. That tactic would be well advised, considering the issue of currency valuation has been a major point of consternation between East and West.
EADS Gets a Shot at Boeing's Market Share After Europe Accuses United States of Protectionism
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This is the third act in a drama that Boeing Commercial Airplane CEO Jim Albaugh refers to as "the longest-running soap opera since 'Days of Our Lives.'"
EADS dropped out of the bidding six weeks ago when its partner in the deal, Northrop Grumman Corp. (NYSE: NOC), claimed the Pentagon's contract proposal had been drawn up to favor Boeing. But the Pentagon agreed to extend the bidding deadline from May 10 to July 9 after European officials claimed the situation reeked of trade protectionism.
EADS tried to find another U.S. company to pair with, but instead was forced to enter a solo bid with the help of American subcontractors. EADS said it felt compelled not to give up because its A330-based tanker is a better fit for the job than Boeing's 767-based tanker.
Pacifying the Panda: U.S. Companies Must Take a New Approach to China
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So why is it that more U.S. businesses feel less welcome in China now than they did four years ago?
The fact is that in the past four years, China's economy has continued to grow by leaps and bounds, while a humiliating financial collapse and soaring debt have tarnished much of the shine that once adorned the U.S. market.
Indeed, for the first time in perhaps more than a century China has the upper hand. How long that will last is a difficult question to answer, but right now, China wants to use its leverage to support domestic companies - and it's doing so unapologetically.
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