There has been a lot of talk about the possibility of creating a sovereign wealth fund in the US. The Secretary of Treasury, Scott Bessent, floated the idea with the press a few weeks ago, saying the U.S. should monetize some of its assets, and in doing so, it should create a SWF. But if you look at the chart below, it’s not clear the U.S. has much assets to monetize, particularly when compared to its liabilities. It’s true that some assets are not marked to market and therefore are higher than the number in the table below, but the difference is surely not $40Tn. Perhaps the big idea here is to revalue those assets and reduce debt, and leave the SWF for a time where the U.S. is not a debtor nation, which seems unlikely for as long as the U.S. dollar continues to be the reserve currency. It would look like the priorities should be (1) reduce the budget deficit and (2) reduce the debt, and (3) increase productivity to spur economic growth.
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