2. The Wealth of Sovereigns

Sovereign wealth funds have existed for more than half a century. The truth is government has and will always have a critical role in the economy. We are now in a period in which the state’s prominence is on the rise.

The early response from US leadership to the proliferation of state-sponsored actors in the economy was more about establishing domestic political advantages than enlightening the public to the realities of globalization. Contrary to the worst fears catered to by officials, SWFs and their like have proven to be no more political than a typical pension or mutual fund.

But the Great Recession changed everything. SWFs played a key role in stabilizing the global financial system, providing significant capital ...

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