The low-key ceremony that marked the launch of China Investment Corp. this weekend could reflect the cautious manner in which Beijing intends to unleash the largest fund in history onto the world's financial markets.
China Investment Corp. is tasked with diversifying and maximising returns on part of the country's huge forex reserves, topping 1.3 trillion dollars and growing by the second.
It is estimated that about 70 percent of this enormous amount is placed in US dollar assets, including Treasury bonds that are as low-yield as they are safe.
The worst thing China could do for the US would be to sweep into, say, the world energy markets and make a series of high-profile acquisitions of oil companies or gas fields. The US tries to conquer oil reserves by military force while the Chinese will just buy them. Who is smarter?
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