"We Hate You Guys" - Reuters Caught Doctoring China Official's Remarks On US Treasury Peril!

The story originally had this key passage:

Mr Luo, speaking at the Global Association of Risk Management’s 10th Annual Risk Management Convention, said: “Except for US Treasuries, what can you hold?” he asked. “Gold? You don’t hold Japanese government bonds or UK bonds. US Treasuries are the safe haven. For everyone, including China, it is the only option.”

Mr Luo, whose English tends toward the colloquial, added: “We hate you guys. Once you start issuing $1 trillion-$2 trillion [$1,000bn-$2,000bn] . . .we know the dollar is going to depreciate, so we hate you guys but there is nothing much we can do.”

However, Mr Luo said Chinese officials would encourage its banks to finance domestic mergers and acquisitions rather than provide rescue finance to distressed financial companies in other countries: “There will be no bottom-fishing of financial institutions, particularly in the US, because there is a lot of uncertainty about the quality of the books.”

The bolded paragraph, particularly, was removed. Completely. I know because a copy was originally emailed to me. Note: Reuters did not disclose that this was an updated version of the release, nor did they change the timestamp on it from Thu Feb 12, 2009 8:22am EST, yet I can confirm the story has changed since 6:56pm on the 13th.

It seems like Reuters couldn't take the heat on how touchy this barely-balanced standoff between the US and China is, and how the runaway deficit spending threatens devaluation or hyperinflation.

Or maybe someone told them this part had to go.

Update: The full version of the quote can still be found in this FT version of the remarks.

Update 2: John from HousingDoom points out that this isn't the first time in recent memory that negative news about Treasuries has been snipped from a major wire service. It isn't disturbing to me that the government wants to minimize concern about the area where virtually all funding pressure is building in our economy. What is disturbing is that private wire services are pliantly censoring concern about these pressures, which are really just simple statements about supply and demand as pertains to Treasuries. Thank God for blogs...

Update 3: Yes, it happened -- here's a video record of Rep. Dan Burton reading out the shocking remarks on the floor of Congress.