Advisor Hassett: “Intel investment is part of Trump’s sovereign wealth fund strategy”

Trump also posts: "Will do more transactions like this"

"There is also an aspect of onshoring manufacturing through tariffs"

Kevin Hassett, White House economic advisor, stated on the 25th (local time) that the government’s purchase of Intel shares is part of a strategy to create a sovereign wealth fund that involves investing in more companies.

President Trump also proudly highlighted the government’s stake in Intel on his social media account on the morning of the 25th (local time), announcing, "I have decided to pursue more transactions like this."

President Trump added, "I also want to support companies that make profitable deals with America," and expressed his hope for a rise in their stock prices and the further creation of American jobs.

Kevin Hassett, Chairman of the U.S. Council of Economic Advisers (NEC), said this in an interview with CNBC regarding the White House’s announcement made over the past weekend about the Intel equity acquisition.

The White House announced last Friday that it would acquire a 10% stake in Intel at $20 per share, totaling about $8.9 billion. The acquisition will be funded by subsidies related to the CHIPS Act, with the remainder covered by government budget allocations for secure chip manufacturing programs.

Hassett emphasized that the U.S. government will not intervene in company operations and explained that these measures are part of a broader strategy.

Chairman Hassett said, "This situation, which has produced enormous semiconductor-related spending, is very extraordinary." He noted, "President Trump has been clear since his election campaign that he believes it is ultimately good for America to create a sovereign wealth fund." He added, "Therefore, I am convinced that similar transactions will occur not only in the semiconductor industry but also in other industries."

In early February, President Trump signed an executive order establishing a sovereign wealth fund. Sovereign wealth funds are typically used by smaller nations with abundant natural resources to secure funding for transactions. According to the Sovereign Wealth Fund Institute (SWFI), Norway operates the world’s largest sovereign wealth fund, managing about $1.8 trillion in assets. China follows, and several Middle Eastern countries also possess large-scale sovereign wealth funds.

Hassett mentioned that while it is rare for the U.S. government to make large equity investments in companies, it is not unprecedented, citing the examples of acquiring shares in Fannie Mae and Freddie Mac after the financial crisis.

He added that such measures are part of a larger strategy that includes tariffs designed to encourage more companies to shift production back to the United States.

On Friday, Hassett also remarked that Federal Reserve Board Chairman Jerome Powell’s announcement at Jackson Hole was reasonable, but pointed out that interest rate cuts have been somewhat delayed. He further mentioned that it would take months for President Trump to select a successor for the Fed Chair.

Chairman Hassett is considered one of four leading candidates under review by President Trump for the next Fed Chairmanship.

Guest reporter Jeong-ah Kim kja@hankyung.com