That’s certainly true, but you can also have too much of a good thing.
When do you know you have enough?
Is this “rainy day” money having unfavorable consequences for others.
I think the point here is that these SWFs and their clones can have a distorting effect on capital markets, taking them further away from the “free market” concept.
In a global market surely we have to consider the wider ramifications rather than just the “national interest”.

That’s one of the things about being a global hyperpower, you don’t have to care what other people think. US loses global goodwill? So what? Unless you can translate that loss into some reward or punishment for the US, no one is going to care.

The primary purpose of the media is to sell newspapers and make money. You were expecting something different?

As far as Iraq goes, I think that has already been decided. Unless the US body count goes up then the next President is going to stay.

We can pull up Federal Election Commission reports, but I’d be shocked if the top IB’s weren’t indirectly also paying money to Obama and any candidate that has a reasonable chance of getting elected. IB’s know that they can’t determine who wins an election, and their first priority in making donations is to make sure that whoever does win, returns their phone calls, and at least talks with their lobbyists.

Also, I don’t see why “democratic” governments are necessarily better at finance or more trustworthy than authoritarian governments. Elections can often create the illusion of transparency and popular control without actual transparency and popular control, and I would argue that the Politburo of the PRC is far more worried about losing power than most of the people at the highest levels of the Japanese government.

As far as economic issues go, the National People’s Congress is far more open, transparent, and powerful in its decision making processes than the Japanese House of Representatives. The Chinese government talked about CIC for two of three years before actually going through with it, and the politics and the decision making processes were reasonably open. It will be interesting to see if Japan goes through the same sort of rather public process that China did.

My own belief is that freedom of speech and personal liberty are good things for their own sakes, but one must not get into the habit of thinking that “democrats” are angels that can do no wrong and “dictators” are all devils that can do no right.

transparent;
works within democratically established guidelines;
and steers clear of direct stakes

I won’t be too worried.

It will tho have to address the delicate issue of investing in companies abroad that compete against big japanese companies

After all, their performance is hardly impressive. They have spent $60bn on stakes in US and European banks and are all showing a 10 per cent or so paper loss. Abu Dhabi invested $7.5bn in a stake in Citigroup that is worth about $6bn. Kuwait has lost around 8 per cent on the $6.6bn it invested in Merrill Lynch. And so on.

The simple conclusion is that all these funds are no smarter than anyone else in picking the right moment to buy. Since they all claim they are investing for the long term, they can clearly afford to take their short-term losses on the chin. Even so, they cannot be too pleased. The question is whether this will make them more assertive, something that is bound to worry policy makers and politicians. But would an activist be any different?—Financial Times

Too bad for us if SWFs stop buying. Where will the money come from to stave off bankruptcies?

Return phone calls.