year. Mr Jin said China can afford to sacrifice its "low-value-added" exports to Japan at a small cost. By contrast, Japan relies on Chinese demand to keep its economy afloat and stave off "irreversible" decline. "It's clear that China can deal a heavy blow to the Japanese economy without hurting itself too much," he said. It is unclear whether he was speaking with the full backing of the Politburo or whether sales of Japanese debt would do much damage. The Bank of Japan could counter the move with bond purchases. Any weakening of the yen would be welcome. A recent study by the US Defence Department concluded that a Chinese firesale of US debt was not a serious threat. The US defence secretary, Leon Panetta, was in Beijing on Tuesday to try to stem the political crisis, calling for restraint on both sides. Mr Panetta said the US is neutral but this is a hard balancing act, given the US nuclear umbrella for Japan and its use of military bases on Japanese soil as an "unsinkable aircraft carrier". The ambiguity of the US role was glaring after a deal with Tokyo on Monday to build a new anti-missile radar shield -- ostensibly against North Korea. Diplomats say China is calibrating the crisis to probe the strength of US ties with Japan, knowing that alliance fatigue in Washington and the clumsy handling of the dispute by Tokyo has created a rare opportunity. The Obama administration must navigate a delicate course. A