Hua Er Jie Jian Wen·2025-08-26 01:28Core Viewpoint - The Trump administration is effectively "taking over" American businesses through a series of equity investment actions, leading to the quiet formation of a U.S. sovereign wealth fund [1][3]. Group 1: Government Investments - The U.S. government confirmed it will acquire 9.9% of Intel's shares in exchange for accelerating the release of $9 billion in subsidies under the CHIPS and Science Act [1]. - Prior to the Intel investment, the government had already invested $400 million to acquire 15% of MP Materials, the only domestic supplier of rare earth magnets [2]. - The government has also required Nvidia and AMD to hand over 15% of their sales in China and obtained a "golden share" in U.S. Steel, granting it veto power over certain decisions [2]. Group 2: Formation of a Sovereign Wealth Fund - These disparate investments are coalescing into a substantive sovereign wealth fund, as noted by experts [3]. - Unlike traditional sovereign funds established by countries with large cash surpluses, the Trump administration's investments are being executed by a coalition of different agencies [3]. - There are speculations that these assets may eventually be integrated into a more conventional fund framework, as the White House has already proposed plans for establishing a sovereign wealth fund [3]. Group 3: Concerns and Controversies - The government-led investment model has raised concerns among academics, with some describing it as a "bad idea at the right time" [4]. - Traditional sovereign funds typically arise in countries with significant cash surpluses, while the U.S. is currently facing a fiscal deficit [4]. - There are questions regarding the necessity of government involvement in a well-developed venture capital industry and financial market [4]. - Concerns have been raised about the transparency and potential politicization of this de facto sovereign fund [4]. - The investment terms may significantly impact corporate futures, as the government retains veto power over decisions that could negatively affect its relationship with companies [4].