The case for maintaining open international financial markets must be weighed against legitimate political concerns.

In the wake of the subprime mortgage crisis, a number of the largest U.S. banks have turned to sovereign wealth funds--the investment arm of cash-rich foreign governments--for large capital infusions to mend their troubled balance sheets. Additional large infusions of resources, which are to be expected as the subprime crisis...

Prohibiting their bond trading will seriously weaken banks and the markets that banks supply with liquidity.

Government meddling in sovereign business is likely to be counterproductive.

Many people, observing the severe problems caused by Greece and other financially weak members of the European Union, wonder why the United States is not similarly afflicted. After all, the structures seem quite similar; the EU is united through a treaty into a single political grouping, while the U.S. is a union of states in a constitutional system. 

These days, billions of dollars is spoken of as pocket change. A by-product of massive government debt burdens and decades of cheap cash from central banks is the notion that, while solvency might be important, liquidity should be easy to find. Particularly for financial institutions, the official state position appears...

At this event, leading experts discussed the economic and legal merits of sovereign wealth fund investments and the likely policy landscape in which they will operate.