Investing General Discussion

The six Gulf countries’ eleven sovereign wealth funds invest about $2 trillion in the U.S, which is over 35% of their total assets under management. Thse countries invest in U.S. stocks, bonds, alternative investments such as hedge funds, real estate, and infrastructure. Over 25% of the total Gulf investments in the U.S. are in equities and about 17% are in fixed income products, especially U.S. Treasuries.

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Iran Reportedly Accepts Crypto and Yuan for Strait of Hormuz Shipping Tolls

Iran has established what amounts to a formalized toll system at the Strait of Hormuz, accepting Chinese yuan and crypto – specifically stablecoins pegged to fiat currencies – as payment for naval escort through the waterway, according to a Bloomberg report published April 1. The system...

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Reshoring U.S. manufacturing while maintaining the USD as the global reserve currency presents a fundamental conflict, as the "reserve currency status" requires the U.S. to run trade deficits to supply dollars globally, often undermining domestic industrial growth. While some officials argue this status acts as a tax on American producers, experts argue that forced de-dollarization through tariffs could cause massive, rapid economic disruption. [1, 2, 3, 4]
Key Dynamics of US Reshoring and the Dollar:

• The "Triffin Dilemma": To keep the dollar as the world's primary reserve, the U.S. must issue debt and run trade deficits to provide global liquidity. Reshoring and trade protectionism (e.g., tariffs) run contrary to this, as reducing imports would diminish the global supply of dollars.
• Industrial Base vs. Reserve Status: Some U.S. officials argue that the dollar’s status has "hollowed out" the American industrial base. Proposals to reverse this include taxing foreign holdings of U.S. Treasuries to force a dollar devaluation, thereby aiding local manufacturing.
• Alternatives Lack Maturity: While the US dollar has seen a slow decline in share to roughly 58% of global reserves, it still leads by a wide margin over the Euro (~20%), with no immediate viable alternative to take its place.
• Challenges to Reshoring: Even if manufacturing moves back, high automation means that widespread reshoring may not bring back massive manufacturing jobs, with capital gains and technology advancements driving productivity rather than labor-intensive manufacturing. [1, 2, 3, 4, 5]

Implications of a Shift:
If the U.S. successfully forces a reduction in the dollar’s role, it would likely mean a weaker dollar, lower long-term debt service costs, but potential volatility in global trade and financial markets

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Foreign investors hold approximately 20% of all total U.S. securities outstanding, with the share varying by asset type, according to data from the U.S. Department of the Treasury. Due to the dollar's status as the primary reserve currency, foreign ownership is highest in Treasuries at about 30–33%, while representing roughly 17–20% of U.S. equities. [1, 2, 3]
Key Foreign Capital Ownership Percentages

• Total U.S. Securities: ~20%
• U.S. Treasuries: ~30–33%
• Corporate Debt: ~27%
• Equities (Stocks): ~17–20% [1, 2, 3, 4]

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