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Politics : The Truth About Islam -- Ignore unavailable to you. Want to Upgrade?

To: Elmer Flugum who wrote (9681)	8/25/2007 1:53:21 PM
From: Elmer Flugum	Respond to of 20106

More proof of the on-going strangulation of the American economy: How a Gulf Petro-State Invests Its Oil Riches online.wsj.com Kuwait's Mr. Al-Sa'ad Likes Asian Real Estate But Is Cool to Treasurys August 24, 2007 "KUWAIT CITY -- Kuwait is a world away from New Haven, Conn. But when a government investment fund here got a new chief in 2004, one of the first things he did was commission a study of the sophisticated ways Yale University invests its endowment. It was a sign that Bader Al-Sa'ad intended to shake things up at the huge but sleepy Kuwait Investment Authority. The investments he has since pursued put his fund at the forefront of far-reaching change in how the oil wealth of the Persian Gulf is deployed. Instead of mostly U.S. Treasury securities, Kuwait now invests in things like higher-yielding bonds, Chinese office buildings and Asian private-equity funds. And, in a move with implications for the strength of the U.S.'s currency and economy, the Kuwait fund is de-emphasizing holdings priced in dollars. Mr. Al-Sa'ad moves away from assets priced in dollars, the euro and the pound sterling, he is moving toward the South Korean won, Malaysian ringgit and Indian rupee. The yen is his least-favorite currency, though, because it's so volatile. When he was a young trader, he says, he used to get up at 3 a.m. and trade the Japanese currency. "I don't remember a day I made money trading yen," he says. "This currency made my hair white." Meanwhile, Kuwait's central bank also has less need to buy U.S. dollars. In June, Kuwait stopped pegging its dinar to the dollar. So Kuwait no longer needs to buy dollars to keep its currency from rising when cash pours in to pay for oil exports. The dinar has appreciated about 2.5% against the dollar since the link was cut. While Mr. Al-Sa'ad is increasing his allocation to real estate, he's selling in markets he regards as too expensive. The fund recently unloaded an office building at 350 Park Ave. in New York it had owned for several years. It is looking to buy where growth is higher, such as in small Chinese cities."