With the price of oil flirting with $100 a barrel, there's been a good deal of excitement recently about "sovereign wealth funds." These government-controlled trust funds, billed as savings for the day the oil runs out, aren't exactly new -- they first gained recognition in the 1970s, when Kuwait and Abu Dhabi began investing some of their oil surplus in financial markets. Nor is petroleum the only possible source of revenues; Singapore and China have accumulated substantial reserves through currency machinations: in effect, forced savings derived from their booming export trade.
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Strong Medicine
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With the price of oil flirting with $100 a barrel, there's been a good deal of excitement recently about "sovereign wealth funds." These government-controlled trust funds, billed as savings for the day the oil runs out, aren't exactly new -- they first gained recognition in the 1970s, when Kuwait and Abu Dhabi began investing some of their oil surplus in financial markets. Nor is petroleum the only possible source of revenues; Singapore and China have accumulated substantial reserves through currency machinations: in effect, forced savings derived from their booming export trade.