China Starts Spending Some of Their U.S. Cash

China has worked hard over the past few years to build-up a massive treasure chest of US securities, almost $846 billion at last count.

Now, it appears they are trying to spend some of it.

"China's top offshore oil producer CNOOC Ltd agreed to pay $1.1 billion for a stake in a U.S. shale oil and gas field, testing the market for the first time since its 2005 failed bid for Unocal.

Most of the outbound acquisitions by China's oil firms have been in risky areas such as Africa, which Western rivals have avoided, or in locations with aging assets.

Now they are also eying the United States, which was once deemed off limits to the Chinese due to protectionist sentiment."

China's prior attempt to purchase US oil and gas assets (specifically, the shares of Unocal) failed back in 2005, so it is not a given that their latest parlay will be approved by Congress.

Having these US-based assets owned by the Chinese should be no cause for concern to Americans, and should simply be viewed as an attempt by China to diversify their vast holdings of foreign currency.

Frankly, this is going to be a recurring them in the future, as holders of the US debt that is being issued with abundance attempt to swap that investment for real, tangible assets located in the US.