Fear of foreigners
From the Economist.com
Jeffrey Garten, a former dean of the Yale School of Management, argued in the Financial Times last week that dealing with sovereign wealth funds may require departures from “conventional liberal orthodoxy concerning global trade and investment flows”. According to Mr Garten: “These funds are going to have the ability to buy any global company, to create panic in markets if they move too precipitously, even to dwarf the political clout of international financial institutions. They can no longer be ignored.” ... On reciprocity, he argues that a sovereign wealth fund's freedom to invest abroad should be tied to the freedom enjoyed by foreign investors in the fund's home country. Not only that, but: “If a sovereign fund was established because of currency manipulation in the host country that led to excess reserve creation (China), or if it is the result of strident resource nationalism (Russia), or if it is due to monopolistic pricing practices (Saudi Arabia), then consultations should be initiated between the two governments to reduce these policy distortions.”