The Arabs Buy In, December 5, 2007

by Will

Will Grigg's Liberty Minute

December 5, 2007

Sovereign Wealth Funds, or SWFs, are huge, State-controlled financial entities that are used by governments to buy key financial or infrastructure assets from other countries.

The world's largest SWFs are controlled by energy-rich countries -- such as the petroleum-exporting kingdoms of the Persian Gulf, and Russia, which has huge reserves of natural gas. Such countries have also acquired immense reserves of currency, particularly dollars.

On November 27, an SWF controlled by the government of Abu Dhabi, an oil-rich member of the United Arab Emirates, spent $7.5 billion to buy a roughly five percent share in Citigroup, America's largest and most prestigious bank.

Citigroup, like most of the banking system, is in potentially mortal peril from the collapse of the mortgage industry. The government of Abu Dhabi, like other Arab petro-monarchies, is aware of this situation. This is why, as economist Gary North points out, Arab oil states may soon control the flow of funds into our capital markets.

Let us take back the liberty wherewith Christ has made us free.

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