Trump is Creating a Sovereign Wealth Fund

[CaptUSA]

https://www.msn.com/en-us/money/markets/trump-is-creating-a-u-s-sovereign-wealth-fund-what-that-means/ar-AA1ylT9h?ocid=BingNewsSerp

President Donald Trump on Monday ordered the Treasury and Commerce Departments to create a U.S. sovereign-wealth fund—a first for the nation.

In an Oval Office signing ceremony, Treasury Secretary Scott Bessent said a sovereign-wealth fund would allow the government “to monetize the U.S. balance sheet for the American people. We’re going to put the assets to work.”

To be honest, I'm not sure of the implications of this financial tool. I've never seen it implemented.

Any Austrians in here want to take a crack at this one?? What does he mean by "monetizing the balance sheet"???

 

[TheCount]

Any Austrians in here want to take a crack at this one?? What does he mean by "monetizing the balance sheet"???

Stealing money from the American people and investing it in ways that benefit him

 

[nobody's_hero]

Some states have them (though they don't specifically call them "sovereign wealth funds"). Utah, Texas, Idaho.

I'm not crazy about the idea. It supposes the government (or some 3rd party board using money that isn't theirs [taxpayer dollars], investing on behalf of the government) is a good judge of worthy investments. (Think back to the 2008 bailouts and government buying up shares of AIG, when AIG should have been bought up at fire sale prices by a more competent competitor). That was basically a sort of unofficial sovereign wealth fund—though in that case, operating for the sole purpose of buying up failing financial institutions. I'd hope that any actual SWF created would be investing based on solid forecasts rather than desperation, but those hopes are pretty low, so yeah—not crazy about the idea.

At some point, the taxpayer seed money is supposed to be cycled back out and the fund becomes self-sufficient. It doesn't sound too bad of an idea, in theory, and in lots of countries it seems to work. But, with our politicians in D.C.? Ehhh . . .

 

[TheTexan]

A SWF sounds good in theory. In practice it would probably be a disaster. And considering how much debt the country owes, how exactly is that SWF account supposed to grow? The only way I can imagine is massive taxes.

The only path to a successful SWF that I see is if government was cut to a fraction of its size and was able to pay down the debt with some money left over.

But of course the odds of that happening is zero.

 

[dannno]

A SWF sounds good in theory. In practice it would probably be a disaster. And considering how much debt the country owes, how exactly is that SWF account supposed to grow? The only way I can imagine is massive taxes.

The only path to a successful SWF that I see is if government was cut to a fraction of its size and was able to pay down the debt with some money left over.

But of course the odds of that happening is zero.

It's going pretty well so far..

(see new DOGE section)

https://usdebtclock.org/

 

[ClaytonB]

To be honest, I'm not sure of the implications of this financial tool. I've never seen it implemented.

Any Austrians in here want to take a crack at this one?? What does he mean by "monetizing the balance sheet"???

I believe he means investing public assets in the market or something along those lines.

Think of an SWF like the strategic petroleum reserve... sounds like a good idea on paper, but each party only thinks about how they can flip it for profit before their term ends. In the process, the asset itself gets destroyed. If Trump manages the SWF like it's his personal nest-egg (the Leftists will howl with anger), then it would be a good thing, because it will grow. But who comes next? And what happens to it then?

From an Austrian perspective, a rational government (e.g. a monarchy) would have a rainy-day fund, just like any other organization should have. Under-capitalization is the #1 cause of business failures... they just didn't save up enough cash ahead of time to get them through the slumps. Governments are no different as far as that goes... there will be slumps and, in order for the organization to operate reliably, it needs to have some cash on hand to get them through those slumps. But again, the problem with democratic rule is that once you get your guy into power, every incentive is to plunder the pantries before you are forced to hand the key over to the other party at the end of four years. So, how can the pantry ever be kept stocked? $36 Trillion and growing says it can never be stocked.

I'll be happy to be proved wrong, though. It's not impossible for Trump to do the right thing and to use an SWF as part of a strategy to bail the US out of debt faster than anyone thought possible. But the general concept is deeply flawed and, sadly, one good POTUS doing one good deed can't fix a perpetually broken system...

 

[Snowball]

https://news.yahoo.com/news/know-trump-administration-plans-sovereign-221843913.html

taking corruption to a new level. very unAmerican. these pricks are stealing our money to load up on things that benefit themselves.
it wil probably have crypto and ai in it.

country is gone mentally. GONE.

 

[Voluntarist]

It comes down to the government choosing winners in the market, by investing in it (and backing the investment with legislation benefiting the investment). Just another step towards a Fascist economic system, as [MENTION=40029]PAF[/MENTION] has warned about

 

[TheCount]

It's going pretty well so far..

(see new DOGE section)

https://usdebtclock.org/

Whose ass does that number come out of?

 

[Cleaner44]

My guess is that he means to take the deposits that we have and earn a return on them, just like any business does. Just think about the poor rate of return that SS gets for Americans. Cash on hand has a value. Isn't that why banks float our money, pretending that they can't clear a check in minutes and instead take days? Billions floated for 2-3 days adds a lot. The U.S. generates an enormous amount of deposits and that equals an enormous amount of opportunity to grow the balance sheet for the U.S.

 

[Snowball]

 

[CCTelander]

Hey! Another government slush fund. What could possibly go wrong?

 

[Madison320]

https://www.msn.com/en-us/money/markets/trump-is-creating-a-u-s-sovereign-wealth-fund-what-that-means/ar-AA1ylT9h?ocid=BingNewsSerp



To be honest, I'm not sure of the implications of this financial tool. I've never seen it implemented.

Any Austrians in here want to take a crack at this one?? What does he mean by "monetizing the balance sheet"???

I think you should have wealth first before you can think about investing it.

 

[unknown]

Errrrr, we're broke.

 

[oyarde]

Ive got soverign wealth fund. Full of pre 1890 one dollar gold , pre 1930 2 1/2 dollar gold , 12 Ga rounds and .223 , .30 - .30 , .30 - .06, .22 etc

 

[unknown]

Ive got soverign weat fund. Full of pre 1890 one dollar gold , pre 1930 2 1/2 dollar gold , 12 Ga rounds and .223 , .30 - .30 , .30 - .06, .22 etc

How may I invest?