| Description | The recent growth of sovereign wealth funds (SWFs) has resulted in calls for a better understanding and closer scrutiny of these institutions on the part of policy makers, financial regulators, and politicians. In order for the policy response to be both robust and fair, different points of view need to be heard and taken into account, not least those of market practitioners who have dealt with such institutions for decades. While there is a tendency to treat all SWFs the same, most practitioners will point out that they are often different in their underlying economics and liability profiles, which lead to meaningful differences in their investment preferences and styles. Typically, SWF policy debates revolve around issues of transparency, non-commercial behaviour and reciprocity. This seminar will attempt to look at these issues in an unconventional light, taking into account the impact of market dynamics. Finally, while there is general agreement that SWFs are a product of the massive global imbalances of recent years, market practitioners are keener to speculate on what this means for the future. Will the SWF phenomenon help sustain global imbalances and stabilise the so-called Bretton Woods II regime, or is it an early sign of cracks in the system, foreshadowing an imminent change in global macro trends? |
