He United States Department of Commerce recruited the former banker of Morgan Stanley, Michael Grimes, to direct a sovereign background of developing wealth, which is part of an effort promoted by the president Donald Trump To ensure a US participation in key projects for national security, according to Bloomberg.
Grimes, who left his post at Morgan Stanley after 30 years, It will join the trade department to supervise this fund, according to sources close to the matter they asked for anonymity because the details have not yet been made public. Although the project is still in its early stages and many aspects can change, the intention is that the background is part of a broader effort of Public-private collaboration to open large-scale institutional investment options.
The Commerce Department did not respond immediately to a request for comments, and Grimes was not available to make statements. During his time in Morgan Stanley, Grimes worked with Elon Musk, Trump’s current nearby advisor, in the purchase of Twitter, according to Bloomberg.
This step reflects the advance of the administration in relation to a Executive order issued by Trump in February, which approached the creation of a sovereign fund. The president had proposed this idea during his electoral campaign as a vehicle to redirect the funds raised by tariffs towards investments in areas such as medical manufacturing, defense and research. Although it is not yet planned that the fund receives income directly from the tariffs, the details continue to evolve.
What is known to Trump’s sovereign background
Last month, the Treasury department also appointed JR Gibbens, a Wall Street veteran and the army, to advise on the plans for this fund.
A possible strategy would be for the sovereign fund to work together with the US International Development Finance Corp. and the Export-Import Bank to boost US investments in key sectors for national security, such as critical minerals, rare earths, manufacturing, technology and defense. This approach would focus especially on areas where China has a dominant position in the market, which could mean a risk to national security.
In January, Bloomberg reported that Trump’s advisors had discussed how DFC could use these investments to expand the influence of the US in strategic places such as Greenland and Panama. The agency’s defenders suggested that this could generate massive investment commitments abroad, backed by some of the most powerful institutional investors in the United States.
At the global level, sovereign funds exist mainly in countries with large foreign exchange reserves, such as China, or income derived from the sale of oil, such as Norway and Saudi Arabia, which invest them in a wide range of assets, including actions, bonds, infrastructure and technology.
The US administration is also evaluating other sovereign funds, such as the ABU Dhabi Investment Authority, the Public Investment Fund of Saudi Arabia and the investment management of Norges Bank, as models for the possible sovereign Fund of the United States.
Source: Ambito
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