Global Strategic Finance Initiative: Latest Articles

Watching Sovereign Wealth

Ron Tang — Thu, 28 Feb 2008 00:00:00 -0500

When the adjectives most often used to describe you are "secretive," "opaque" and "mysterious," you've got an image problem. Such is the predicament of sovereign wealth funds, the government-controlled investment vehicles, often in authoritarian states, that have become the bane of Western politicians. Yesterday, the European Commission became the latest body to propose transparency guidelines for these funds.

But the good news for sovereign wealth funds is that increased disclosure and transparency may actually be a win-win for everyone. A little openness can go a long way.

Market participants and regulators would benefit by gaining some insight into potential contagion risks and… more

Mission Accomplished

Articles — Thu, 15 Nov 2007 17:30:00 -0500

Perhaps it's time to add the European Bank for Reconstruction and Development to that list of things that, like houseguests and fish, can overstay their welcome. The bank now strays so far from its original remit that it risks spoiling the legacy of its earlier successes. The EBRD should quit while ahead, declare victory and be privatized.

At its pinnacle, the EBRD was a triumph of financial statecraft. Established in 1990 with funding from the U.S., the EU and other governments, it provided financing to companies in postcommunist Central and Eastern Europe at a time when the private sector shunned them.… more

Inside Track: The Financialization of Foreign Policy

Articles — Wed, 17 Oct 2007 08:29:00 -0400

Over the first half of 2007, central banks in the world’s emerging economies accumulated over $600 billion of new reserves. That’s double the total reserve position of the International Monetary Fund (IMF) -- an institution whose mission used to include preventing the collapse of these same governments, and whose new managing director recently raised questions about the body’s “relevance and legitimacy.” Over the same period, China, Russia and Japan joined the list of governments establishing “sovereign wealth funds”, whose worldwide assets now approach $3 trillion. The U.S. Treasury, meanwhile, is focusing its attention on the Strategic Economic Dialogue with China,… more

Capital Warfare

adminn — Thu, 29 Mar 2007 12:56:00 -0400

With Iraq, Afghanistan and the war on terror dominating headlines in Washington these days, there's a real danger that U.S. policymakers will lose sight of the other major war currently being fought around the world -- the war for capital. While other countries are fighting with all they've got, many in the U.S. remain complacent, indifferent or antagonistic. Big mistake. There's a clear relationship between global financial leadership and global influence, and if history is any guide, Americans can't assume that today's financial powerhouse will be tomorrow's.

The war for capital is a three-front battle, encompassing competition among sources, markets and… more