1MDB (1Malaysia Development Berhad) took a photo on the bus window in Kuala Lumpur, Malaysia on February 17, 2017.
Chris Jung/Nurphoto
After decades of Washington told Asia that it was Asia's turn to worry that the United States had wasted its foundation.
After all, the U.S. dollar and U.S. Treasury securities are the circular system of global trade and finance. And, there is no more territory in the way Donald Trump once again harms Washington’s credit rating.
In fact, so good that five former Treasury Secretary-Generals- Robert Rubin, Lawrence Summers, Timothy Geitner, Jacob Liu and Janet Yellen- New York Times last week.
Ironically, Rubin, Summers and Geithner were tough in their efforts to end the 1997 Asian crisis, which was largely caused by crony capitalism. Now, Asia is watching the Trump world seems to be reshaping many of the problems behind its collapse.
This may be fearful for some people. However, as a Washington journalist at the time, I sat in a seat on many planes, putting those financial firefighters who might be traveling to and from Bangkok, Jakarta and Seoul onto the seats.
Granted, officials from the Ministry of Finance, the IMF and the World Bank made many mistakes. As the economy ages collapses, demand for fiscal austerity and higher interest rates.
However, it is incredible to watch Trump 2.0 dangerous institutions need to maintain the U.S. economic leadership and maintain the dollar's reserve status. Also soon, the court struggled to keep up with Trump's tsunami of orders as Republicans controlled Congress opposition.
Experts often refer Trump, Tesla billionaire Elon Musk and Vice President JD Vance to Russia or Vake with Vladmir Putin Comparison of Viktor Orbán's Hungary. For me, the Asian lens is also worth a try to see where Trump 2.0 might bring to the United States.
Anyone who follows Asia’s last 40 years knows that passing greater power to politically linked billionaires, empowering families with dynasties, sterilizing anti-corruption efforts, attacking press freedom, evil and well-known gas investment in the judiciary The endings of the person are often very poor.
The era of Ferdinand Marcos Sr. in the Philippines was a clear case study from 1965 to 1986. The current president's father will be destined to be the Southeast Asian and Japanese economy that is separated from dictatorship and rampant corruption from the road.
Students in the Philippines over the past fifty years will be familiar with how Trump 2.0 seems to see the U.S. government as an extension of family businesses. When Trump abandons basic transparency and measures and balances the roadside, the cautionary tale of Manila is worthy of attention.
But Trump is increasingly moving towards Malaysia through his plans to build a sovereign wealth fund. Investors' PTSD was triggered because Trump had the risk of planning his own 1Malaysia development project Berhad-like scandal.
That episode rocked Southeast Asia in 2015, when then-directed Minister Najib Razak went to jail. Back in 2009, Najib believed for some confusion that Malaysia needed another national investment plan on the real sovereign wealth fund Khazanah Nasional Berhad.
In theory, these entities are quite common for resource-rich countries. There is one in more than 90 countries. Malaysia, for example, has enviable storage of bauxite, copper, gas, gold, hardwood, iron, mercury, palm oil, tin, tin and other products.
However, 1MDB is more like Najib's vanity project than the entities required by Malaysia. And, wow, this broke out against his United Malay National Organisation Party. In 2015, the public learned of billions of dollars. This initiated an international investigation, corruption, bribery and money laundering from Singapore to New York to Zurich. This also makes Goldman Sachs a global headline for all the mistakes.
Cash related to 1MDB found production budgets for high-end art, real estate, superyachts, model Miranda Kerr's jewelry box and Leonardo DiCaprio's hit movies The Wolf of Wall Streetamong other unlikely places.
To be sure, it is not an ideal comparison to what Trump envisions as 1MDB crash. But as Trump develops, some echoes are worth exploring.
No one can say whether Trump’s White House sovereign wealth fund will trigger a bull market in a global survey. But the motivations and mechanisms that Trump thinks of are disturbing.
To anyone knows, Trump’s fund will be funded by debt and bet heavily on domestic assets. This will deviate from how such funds usually work. It could increase the budget deficit while national debt dropped to $37 trillion. There seems to be no time now to exacerbate imbalances and overeating in the United States.
Especially because too many sovereign wealth pools lead to nepotism. The purpose they should serve – think Norway here – is helping a country invest in awkwardly from huge oil exports, which have profits far exceeding the demands of today's governments.
But when one of the highest U.S. exports are already government debt, raise one debt to new debt. The same goes for Trump’s advice about his fund potentially eventually buying Tiktok. Talk about “national media”.
As Malaysia has shown, a national fund is more about power and vanity than reinvestment in the benefits of underground treasures is the secret to disaster. There are enough scandals in Trump 2.0's hands. Why create another one? Asia has a wealth of reminders that just because the president thinks he has the ability to do something doesn’t mean he should do it.
