China's CIC just lost another US$ 5.4 bn

Not so safe
via WikipediaWho thought that China would continue to finance US exuberance, should think again. While most of its foreign reserves are stored in relatively safe US government bonds, there are some exceptions, reports Bloomberg. The investments of the China Investment Corporation (CIC) in Morgan Stanley and Blackstone might already been written off, more losses are on the books:

Stable Investment Corp., an affiliate of Beijing-based CIC, was the largest shareholder in Reserve Primary Fundon Sept. 1, according to regulatory filings. Reserve Primary suspended withdrawals last month after becoming the first U.S. money- market fund in 14 years to leave investors with losses. Stable Investment had about $6 billion in additional U.S. money-market funds earlier this year.

CIC was its largest shareholder. It is still a trickle on the US$ 1.8 trillion in foreign currency China is holding, it might encourage the company to invest in safer places, like China itself.

Commercial
Making sense out of China's economy and its financial policies might not be that easy, but at the China Speakers Bureau we have leading experts who can help you to find your way. When you are interested in having one of them at your board meeting, conference or panel, do let us know.

Related articles by Zemanta

• Beijing's View of the Finance Crisis: Opportunity and Danger
• People's Bank of China buys stake in Prudential
• Morgan Stanley tumbles despite talks with Wachovia and Chinese investor