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US and China are at risk of a '10- or 20-year' economic cold war, former Fed governor Warsh says

2018-10-05 07:16:16       source:CNBC

October 4, 2018

The U.S. relationship with China is "probably as poor as" it was before the Nixon administration opened up ties more than four decades ago, former Fed governor Kevin Warsh told CNBC on Thursday.

"We're at the risk of a real cold war" between the world's two biggest economic superpowers, said Warsh, who had been on President Donald Trump's short list for Fed chairman before Jerome Powellwas chosen. "The last 30 years we've been living and breathing globalization as if it's an inevitable force."

Warsh was using the term "cold war" to mean an economic standoff, not the decades-long "mutually assured destruction" nuclear stalemate between the U.S. and Russia that began to thaw in the detente period that led to the fall of the Berlin Wall in 1989.

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