Reverse Dollar Drain

During the recent market turmoil, SWFs provided $59 billion in much-needed liquidity to the Wall Street banks battered by more than $130 billion in writedowns from the declining values of mortgage-related assets.

While a significant share of this liquidity came from GCC based sovereign funds, economists said that the massive economic diversification and infrastructure development under way in the Gulf countries have substantially increased the chance of reverse investment flows.

In other words, the availability of future funds (for investment abroad) from the oil-exporting nations would increasingly depend on what share of oil revenue is taken for in their domestic economies.

Other factors also include the pressure on arab leaders to create job opportunities for citizens in the range of 4-6 million over the next 10 years .

Improving real estate locally is yet another arena into which many of the GCC states have have followed in Dubai's footsteps as viable opportunities notwithstanding the fact that they could potentially serve as alternate revenue sources in times to come.

Wall street may not feel necessarily feel the impact of this in the near term.But being bailed out each time by the Gulf Alliance may not be the best strategy . Then again , there's Singapore right?