The End of Influence

Ashby Monk

Reihan Salam has a great review in Forbes of Cohen and Delong’s new book entitled, The End of Influence. I was particularly fascinated by the following sections:

“East Asian surpluses have also been poured into sovereign wealth funds. The end result has been that American consumers enjoy cheap manufactured goods while emerging East Asian economies have poor populations but a powerful hedge against currency crises. If these countries could rely on better global institutions to protect themselves against financial crises, they wouldn’t have to engage in this wasteful form of self-insurance.”

So true. Here’s another interesting nugget:

“We shouldn’t be surprised, however, if the sovereign wealth funds of other less-affluent, less-transparent and less-exemplary countries choose to advance the national interest through other means. Given that the money bottled up in China’s sovereign wealth funds is essentially extracted from its hard-working population, why shouldn’t the Chinese government use it to acquire American firms and transfer their technology and manufacturing facilities to China?”

Is this a justification for using SWFs to advance political agendas? I need to read this book…

1 Response to “The End of Influence”

  1. 1 rien huizer January 12, 2010 at 6:22 am

    The quotes look pretty acceptable to me! Especially the first one. Though, the second one is a bit out of date. I thought that pretty soon, there would be no plants left to transfer, their current owners having transferred them already…

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This website is a project of Professor Gordon L. Clark and Dr. Ashby Monk of the School of Geography and the Environment at the University of Oxford. Their research on sovereign wealth funds is funded by the Leverhulme Trust and The Rotman International Centre for Pension Management.

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