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Moreover, the scale of such an investment would be unprecedented. To be effective against fiscal challenges, a U.S. sovereign wealth fund would need to amass significant capital that could easily disrupt global financial markets. A fund of this magnitude would likely end up owning substantial stakes in various public companies, prompting concerns over market influence and governance.
The Rationales Behind the Proposal
Despite the daunting challenges, there are four principal motivations behind establishing a sovereign wealth fund in the U.S.:
- Geopolitical Influence: As countries like China boast large sovereign funds, the U.S. may feel compelled to follow suit to remain competitive and assert its global economic status.