No one was under any illusion that it was simply a market relationship, a matter of business as usual. When Paulson was worried about a Chinese dollar sell-off, he knew whom in Beijing to call. Larry Summers’s cold war analogy proved more apt than he realized. The balance of financial terror held.56 But in the meantime, what became increasingly clear was that the US policy-making elite had been focused, as Bradford DeLong would put it, on the “wrong crisis.”
