Yale professor Jeffrey Garten provides an interesting perspective on the implications of a falling dollar as well as a mix of policy recommendations to prevent the current dollar drop from turning into a rout. Among his recommendations is
a proactive Treasury policy of engagement with foreign sovereign wealth funds in preparation for a potential onslaught of foreign acquisitions of U.S. companies. Garten makes the point that the falling dollar could bring about a rise in nationalist-protectionist
sentiment as U.S. firms are increasingly targeted by private sector and sovereign suitors.
We expect an increase in financial-services industry targets here in the United States, particularly originating in the oil-rich Middle East. We have witnessed already a strategic
by the U.A.E., with the DIFX/OMX/Nasdaq/LSE deal, and AbuDhabi's stake in Carlyle. With other sovereign funds such as Qatar Investment Authority, Temasek, newly capitalized China Investment Company Ltd., the stage is set for some compelling