US Money Managers Look Abroad

They hope to cash in as more foreign governments invest in the US
By Jim O'Neill,  Newser Staff
Posted Jan 26, 2008 12:30 PM CST
US Money Managers Look Abroad
A man enters the Morgan Stanley building on Wednesday, Dec. 19, 2007 in New York. The No. 2 U.S. investment bank has sold a sizable stakes in the company to foreign governments.   (Associated Press)

US money managers are looking overseas, where foreign governments, flush with cash and eager to spend it, are becoming increasingly involved in the US economy through investments in major Wall Street firms, real estate, and the stock market, reports the Wall Street Journal. Up to $200 billion annually could be invested, earning managers $8 billion in fees.

But as these government-owned sovereign wealth funds—like the $200 billion China Investment Corp—grow, they also become more selective in choosing managers, looking to regional knowledge and commitments. “You can’t just fly in and fly out,” says one expert. Firms worry it may be a short-lived cash cow as funds begin to develop in-house money management talent. (Read more foreign investment stories.)

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