By Denny Gulino

WASHINGTON (MNI) - Treasury Secretary Tim Geithner Thursday said Asian economies including China are beginning to manage their currencies more aggressively again, fighting appreciation, yet he remains confident China will eventually resume appreciation of its currency and "it's not going to actually take that much time."

Sen. Chuck Schumer told Geithner he's still aiming to make a new push to create legislation pressuring China to move faster.

Geithner's verbal dexterity was thoroughly tested as Republicans blamed him for high unemployment and called for his resignation while Democrats blamed U.S. tolerance of China's currency regime for the same thing, high unemployment.

Democrat Schumer arrived at the Joint Economic Committee hearing geared to use Geithner's appearance to highlight his continuing threat to revive the effort earlier abandoned to get the Senate to sign on to some effort to speed up China currency appreciation.

"As confidence has returned you've seen countries across the region, in China and elsewhere, starting to intervene again to lean against the upward pressure in their currencies," Geithner said.

He continued, "It makes it harder for the system to work, it makes it harder for the overall financial (system) if you have a large country like that tying its currency directly to the dollar. And I think that's going to have to change and I think it will change over time, and my own sense is it's not going to actually take that much time."

"What's changed recently again," he said, "after a long period where intervention had stopped, it started to increase again."

Schumer interrupted, "It hadn't stopped. It had been modified. They still didn't let the currency freely float. They were still manipulating it but they let it rise."

Geithner resumed, "True, but the scale of intervention declined dramatically in the peak of the crisis. It's started to increase again," he continued, "not just in China, but in countries around the world and it's related, of course. It's harder for those countries to move if the biggest economy, among the biggest economies in the region, is not moving as well."

"Do you have any hope based on the president's meetings in China? Schumer asked.

"Should we just sit here again and be thrown out of work and watch the world economic system tie itself into a pretzel because the most prosperous country of them all is saying we want to be more prosperous at everybody's expense?", Schumer asked Geithner.

The Treasury secretary answered about China, "I think they recognize that it is not just important to us and to their trading partners but it's important to them that they move over time."

"China has taken very aggressive actions to stimulate domestic demand for our products over this period of time," Geithner continued. "Our exports to China are actually growing at a pretty healthy rate because of that broad thrust of policies they put in place."

Schumer then asked, "If they allowed to float wouldn't they grow at much greater rate?"

"They would," said Geithner.

"Senator (Lindsay) Graham and I are going to try to do something legislatively," Schumer said.

Added Geithner, "Let the record show, I was not asking you to be patient."

Earlier Geithner was accused by various Republicans of either setting the stage for the high unemployment rate as New York Fed chief or now perpetuating its causes through Obama administration policies. He occasionally erupted, saying at one point, "I agree with almost nothing in what you said. Almost nothing in what you said represents a fair and accurate perception of where this economy is today."

He repeated that as expensive as was the bailout of insurance giant AIG, the ultimate cost of a failure like that of Lehman Brothers would have been a lot higher.

He again sketched the depths of the crisis, saying it could have become a lot worse had government not acted aggressively. "You saw trade stop. You saw financial activity stop," he said. "You saw the basic savings of Americans plummet. You faced for the first time, again, since the Great Depression, a generalized run on our financial system."

"AIG presented exactly the same kind of risks Lehman did, but in some ways they were greater," since AIG had as counterparties millions of "households across the country."

He said without the kind of tools that financial regulatory reform might provide, "We had basically duct tape and string" to "try to contain the damage and the panic."

He also said he looks forward to the end of TARP, but did not endorse efforts to cap its expenditures. "We are winding it down and will close it as soon as we can," he said.

When asked by once Republican if he is going to resign, Geithner said, "It's a great privilege for me to serve this president."

** Market News International Washington Bureau: 202-371-2121 **