Senior officials of the US Treasury Department are sneaking around Davos trying to get the managers of big sovereign funds from Asia and the Middle East to sign a code of conduct.  David McCormick, undersecretary to the Treasury said to the FT that "the growth of these funds and increased levels of their investment does raise legitimate questions about how we can ensure that that investment continues to be commercially driven."

Indeed. Commercially driven. Would that be commercially driven like Carl Icahn is? He can buy a big US company and dismantle it. He can cut tens of thousands of US jobs. It may make his fellow shareholders bags of money. Hopefully, he will not sell of any state secrets in the process. It might be another way to make money.

The Treasury appears to want to head off concerns in Congress that the US is auctioning strategic assets to the highest bidder. But, is Citigroup (C) really a critical asset to America, or can its place be taken by JP Morgan (JPM), Bank of America (BAC), and Wachovia (WB)? Foreign interests own a piece of the Nasdaq and chip-maker AMD (AMD). An AMD employee could walk out of the company with most of its secrets on his or her laptop. Along with all the Visa account numbers and social security information on any database a smart software engineer can hack into.

Some old Senators like Robert Byrd who has been sitting in the body since the writing of the Declaration may voice concern about why the US cannot run its own businesses while relying solely on American money. They may rattle cages and threaten new laws.

But, the fact of the matter is that US companies in trouble are not getting US money. US money is smart, frightened, or is poor supply.

Sovereign funds may sign an oath of good behavior but money is money when times are bad.

Douglas A. McIntyre

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