China diversifies U.S. holdings

CIC filed its purchases with the Securities and Exchange Commission, showing it now owns a stake in Morgan Stanley, Bank of America, Visa and Coca-Cola. It also bought stakes of Visa, Johnson & Johnson, Motorola and Visa, The New York Times reported Monday.

The stakes are not necessarily large per company, but show China's intention to diversify its portfolio and its growing wariness of U.S. Treasury securities.
With U.S. debt rising, Prime Minister Wen Jiabao has expressed doubts about the U.S. government's ability to finance its debt.

The CIC investment fund totals $300 billion, making its U.S. investments "relatively small … compared to the total size of the fund," said Chang Chun, a China Europe International Businesses School finance professor.

U.S. executives tend to say China behaves like most investors, the Times said. "They are hugely commercial and they want results," said Richard Elman, founder and chairman of Noble Group, a commodities brokerage.

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