Plus: Surprise of the day
IN TODAY’S EDITION
1️⃣ A sovereign wealth fund for the US? |
2️⃣ Is Japan’s Nissan-Honda merger dead? |
3️⃣ Surprise of the day |
Hi Intriguer. I never really thought about sovereign wealth funds (SWFs) until I visited Norway. The country just oozed with err, wealthy vibes. And these vibes are backed up by the country’s actual riches in its high-performing SWF, valued at a cool $1.8 trillion USD as of this month.
Norway might lead the SWF club for now, but it’s certainly not alone in there. Both the number and value of SWFs have grown quickly, with over 70 new funds established just in the last ten years.
And as we’ll see in today’s top story, there might soon be a new entrant into the SWF club — the United States. Let’s dive in.
PS – Will you be at next week’s Munich Security Conference? Intrigue’s very own Kristen and John will also be there. Please drop us a line if you’re around!
World leaders slam Trump Gaza plan.
Trump aides have walked back parts of the president’s comments about the US taking Gaza, as UN chief Guterres urges the world to “avoid any form of ethnic cleansing”; German foreign minister Baerbock warns that the proposal would “lead to new suffering and new hatred”; and Saudi Arabia reiterates the kingdom’s “unequivocal rejection” of any forced displacement of Palestinians. Meanwhile, the Israeli military has received orders to prepare for voluntary departures from Gaza "to any country willing to accept them".
US, Panama issue conflicting updates on free passage.
The Panama Canal Authority has now denied a US State Department claim that US government vessels will get free transit via the Panama Canal. It’s unclear if this was all a massive miscommunication, or a US attempt to present Panama with a fait accompli (though the sums involved for US government vessels are relatively minor).
US set to unveil Ukraine peace plan.
According to Bloomberg, the US might share with allies Trump’s plan to end the Russo-Ukraine war at next week’s Munich Security Conference (we’ll be there). Reports suggest the plan could include freezing the conflict and leaving Russian-occupied territory in limbo, in return for providing Ukraine with security guarantees so Russia doesn’t attack again.
Rubio to skip G20.
Top US envoy Marco Rubio has announced he won’t attend the upcoming meeting of G20 foreign ministers in Johannesburg, citing South Africa’s “expropriation of private property”, and noting that his job is “to advance America’s national interests, not waste taxpayer money or coddle anti-Americanism.”
Ruling party set to win first Delhi state vote in 27 years.
Exit polls suggest the ruling Bharatiya Janata Party (BJP) is set to win the Delhi state elections, wresting control from the reformist Aam Aadmi Party. If confirmed, it’d be a relief for Prime Minister Modi’s BJP, which under-performed in last year’s general elections.
Intrigue in conversation with…
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Join Intrigue for a candid conversation with Gabrielius Landsbergis, former foreign minister of Lithuania (2020-2024). This coming Wednesday!
TOP STORY
Is the US getting a sovereign wealth fund?
For any Intriguers who’ve dabbled in the television world of Succession, you’ll recall a memorable scene where the tycoon father, surely inspired by Rupert Murdoch, sends his son (Roman) to the Middle East to secure emergency cash from sovereign wealth funds.
“No strings, and dry powder”, is how the media mogul describes the cash [yes, he uttered another spectacular word we won’t repeat here — hi kids 👋 hi corporate firewalls 👋].
We mention this classic TV moment because this week, Rupert Murdoch, the Middle East, and talk of establishing a US sovereign wealth fund all showed up in the Oval Office.
And here’s why, despite being lost among the various wild headlines (helpfully curated for you above), this one is worth your attention.
First, a sovereign wealth fund, you say?
They’re state-owned funds that invest a country’s surplus cash, often from things like oil and gas exports. So they’re like private funds but with fewer puffy vests, more national objectives, and greater government control (sometimes via a semi-independent board).
But while everyone oohs and ahhs at Norway’s mouth-watering $1.8T fund, and watches with envy as the Saudis dip into their own fund to build trophies cities the size of Belgium, Trump’s move still arguably reverses course on 70 years of economic reasoning.
Think of it like a row-boat: for many in the US and broader West, governments might nudge the rudder to adjust economic course (via rules and regulations), but they’ll traditionally leave both the rudder and oars (growth, investment) to the private sector. Even Communist Party-led China saw sense in letting the people grab more of the oars.
And sure, that balance has ebbed and flowed over the decades — without enough transparency or accountability, for example, there’ve been some spectacular examples of sovereign wealth funds evaporating in a puff of incompetence and corruption.
But things started to change when the US economic row-boat hit an iceberg of sub-prime mortgages in 2008, reminding everyone of the risks of letting corporates have too much free hand over the rudder. So as Western governments bailed out banks, they also started recalibrating their ties with big money.
And more capitals have now seen sovereign funds as part of that new balance… most are still smaller than many pension funds (looking at you CalPERS), but some are now massive — the world’s largest (Norway) alone owns 1.5% of all the world’s listed shares.
Second, sovereign wealth funds as a tool, you say?
We didn’t say that, but sure — ordinarily, if you’re a shareholder who dislikes where a company is headed, you just sell your shares, or maybe become an activist investor heckling at the annual general meeting.
But for a sovereign wealth fund, the owners are theoretically the people who (via their governments) can tie these vast pots of gold to national interests and values. And of course, that means there are always debates around how — or even whether — to define those national objectives. Norway, for example, uses a randomly-selected citizen advisory body.
So then third, what’s Trump’s plan?
Given the above, by the time Trump signed an executive order to create a sovereign wealth fund, the mood around DC was eh, okay, not the worst idea we’ve heard this week.
That’s partly also because it’s not the newest idea, either — two dozen US states already have funds, and Joe Biden’s aides were working on something similar last year.
So what exactly is Trump proposing? The details are now up to his newly minted treasury and commerce secretaries, Scott Bessent and Howard Lutnick, but Trump’s order wants his new fund to: a) promote fiscal sustainability, b) lessen the tax burden, c) establish longer-term economic security, and d) promote US leadership abroad. The first two suggest it’ll make money, while the latter two suggest it’ll pursue national objectives.
Bessent and Lutnick have 90 days to come up with answers to all the obvious downstream questions that then flow, like where the cash comes from (the US runs deficits), where it should be invested, and how it should be managed.
Meanwhile, Trump’s spit-balling with the media also offered a few specifics: he suggested a fund could be capitalised with income from tariffs (though the Canada-Mexico tariffs just got put on hold); and could be used to finance the purchase of TikTok (though the TikTok divest-or-ban law is due to enter force before Bessent and Lutnick are due to submit their report). Lutnick also chimed in, suggesting the US government could take stakes in companies with which it partners (like big pharma).
Anyway, how did we get onto all this? Ah yes, Succession. So maybe let’s leave you with one final quote from the show, shall we? This time, from Roman: "Ooh, nice vest. It’s so puffy. What’s it stuffed with, your hopes and dreams?"
INTRIGUE’S TAKE
We’ve talked before about the way Trump’s campaign pulled together various ‘tribes’ when it comes to America’s approach to the world. The same applies on the economic front, too:
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For libertarians, the very idea of a sovereign wealth fund is heresy — each dollar in the fund is (in their view) a dollar that belongs in an American pocket.
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Liberals and conservatives have differing ideas about the role of government, but might welcome a sovereign wealth fund if it helps advance their values, and
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Populists are really up for anything (including a sovereign wealth fund) if it seems run by — and for — the people rather than some opaque elite.
Now, this is the type of discussion someone might ordinarily have (or yell) on a college campus somewhere, perhaps wearing a beret. But rather than take a side, we just paint the above picture so we can note that really the only US tribe that would — on principle alone — reject a sovereign wealth fund would be the libertarians. But Trump already has them on board via his broader crypto-friendly and deregulation vibes. And you know what? We wouldn’t be surprised if this fund ends up investing in crypto, too.
Also worth noting:
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During last year’s campaign, Trump also suggested a US fund could invest in infrastructure, defence, manufacturing, and medical research.
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Indonesia also passed legislation this week shifting $61B in state assets into a fund reporting directly to President Prabowo Subianto, in an effort to boost growth. Around half the world’s countries already have funds of some kind, including US friends like Australia and Norway, and US rivals like China and Russia.
MEANWHILE, ELSEWHERE…
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🇵🇰 Pakistan: The UN has raised concerns about Pakistan’s plan to deport thousands of Afghan refugees waiting for relocation to the US and elsewhere. There are around 1.45 million Afghan refugees currently living in Pakistan.
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🇬🇧 UK: Prime Minister Kier Starmer has opted not to participate in next week’s AI summit in Paris, preferring to focus on domestic priorities instead. French President Emmanuel Macron, Indian PM Narendra Modi, and US VP JD (triple acronym) Vance are all expected to attend the event, the latest in a series first kicked off by Starmer’s predecessor, Rishi Sunak.
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🇵🇭 Philippines: A long-running feud between two of the country’s most powerful political dynasties escalated again this week, after lawmakers voted to impeach vice-president Sara Duterte (daughter of a former president) on alleged corruption. If the senate confirms the vote she could then be removed, in what would be a win for President Marcos (son of another former leader).
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🇦🇷 Argentina: Buenos Aires has announced Argentina will soon exit the World Health Organisation (WHO), citing “deep differences” over how the WHO managed the COVID-19 pandemic. But apparently, Argentina will remain in the Pan-American Health Organization, which is kinda the WHO’s regional branch (though also part of the DC-based Organization of American States).
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🇸🇾 Syria: Syria’s new leader Ahmed al-Shaara has continued his regional tour, this time landing in Turkey for his first official meeting with President Recep Tayyip Erdogan. The pair discussed Syria’s reconstruction and security outlook, including US-supported Kurdish militias which Turkey considers enemies.
EXTRA INTRIGUE
Meanwhile, in other worlds:
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💸 Finance: Nissan is reportedly bowing out of merger talks with Honda, after failing to reach a deal over the past seven weeks.
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🖥️ Tech: Alphabet CEO Sundar Pichai has praised China-based AI startup Deepseek, calling it a “tremendous team” doing “very, very good work”.
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👔 Fashion: The Met Gala, a fundraising event-turned-pop-culture-phenomenon, has announced this year’s dress code as ‘Tailored for You’.
SURPRISE OF THE DAY
Credits: Citizen TV/BBC.
Is it a bird? Is it a plane? Oh, yikes, stop smiling — that’s actually a half-tonne metal disk hurtling towards Earth.
Residents in a small Kenyan village were shocked to discover a huge metal disk in the middle of a field, which had seemingly dropped out of the sky. Kenyan authorities were quick to determine the object was a rocket separation part which had failed to burn up upon re-entry into the Earth's atmosphere.
Incidents involving space debris falling back to Earth are more common than you think: just last year a bit of International Space Station landed on a Florida home. But we’ve got good news too: the chance of you getting hit by space junk is about one in a trillion. Or to quote Dumb & Dumber, “so you’re telling me there’s a chance…”
DAILY POLL
Do you think governments should have sovereign wealth funds? |
Yesterday’s poll: Do you consider a country's security updates before booking a holiday?
🟩🟩🟩🟩🟩🟩 👍 Yes, I always check the latest news (66%)
🟨🟨🟨⬜️⬜️⬜️ 👎 No, just take standard precautions (31%)
⬜️⬜️⬜️⬜️⬜️⬜️ ✍️ Other (write in!) (3%)
Your two cents:
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👍 I.P: “Why would one check the Star-rating of a hotel without determining if they might be kidnapped before they even get there?”
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✍️ T.W: “I read more news than I take holidays, so the list self-edits. Myanmar (for example) might have dropped a spot this morning.”
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👍 A.W: “I also always register as a citizen abroad!”
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👎 J.L.O “I’ve been to Juarez, Mexico and Guayaquil, Ecuador recently, and I have friends who visited Venezuela. As long as you don’t do anything too stupid you’re generally fine.”
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