President Donald Trump has signed an executive order to create a sovereign wealth fund in the United States within the next year. The purpose of the fund remains unclear, with Trump suggesting it could potentially buy the short video app TikTok. The creation of such a fund would require approval from Congress, as the US government operates at a deficit, unlike typical sovereign wealth funds which rely on surplus budgets.
Treasury Secretary Scott Bessent stated that the fund would be established within the next 12 months and would aim to monetize assets for the American people. However, investors on Wall Street have expressed skepticism about the economic feasibility of creating such a fund without budget surpluses.
The announcement of the sovereign wealth fund comes as a surprise, with former President Joe Biden’s administration also considering establishing a similar fund before Trump’s election in November. The international Forum of Sovereign Wealth Funds reports that there are over 90 such funds globally managing trillions of dollars in assets.
In a surprising twist, Trump also hinted that the wealth fund could potentially buy TikTok, which has faced uncertainty in the US due to national security concerns with its Chinese owner, ByteDance. Trump signed an executive order to delay the enforcement of a law requiring ByteDance to sell TikTok by 75 days. He has stated that he is in talks with potential buyers for TikTok and that a decision on its future will likely be made this month.
Source
Photo credit www.aljazeera.com