In the U.S., the Abu Dhabi Investment Authority, controlled by the royal family, agreed in January to buy a $7.5-billion chunk of Citigroup in a deal that saved it from collapsing under bad real estate loans. The authority is estimated to control cash and holdings worth between $420 billion and $875 billion.
A separate sovereign wealth fund, the Abu Dhabi Investment Council, bought a majority stake in Manhattan's Chrysler Building in July.
And while xenophobes may bristle at the idea of sheiks in white robes owning venerable Western institutions and brands, more astute observers see a maturation of the gulf states from the quick-hit, cash-and-carry business culture of yore to a more sophisticated view of the world economy.
Indeed, the oil-rich gulf states have long conducted business with the West. Now instead of just trading barrels of oil for Western goods and services, they are investing in those businesses, figuring out how they work and bringing the knowledge back to the gulf.
For example, some scoffed when Abu Dhabi's Mubadala Development Co., a sovereign wealth fund, bought a 5% stake in Ferrari, the Italian car maker. There go the Arabs, some snickered, foolishly spending their money on flashy toys.
But the chuckles petered out after Abu Dhabi announced the creation of the Ferrari World theme park, featuring rides, roller coasters and a race track, as well as the first Abu Dhabi Grand Prix, both sure to draw big tourist dollars from the Arab world as well as Europe and South Asia. Mubadala also invested about $620 million in U.S. chip maker Advanced Micro Devices last year.
"Abu Dhabi has a more sophisticated vision than just making more money," said Edward Borgerding, an ex-Disney executive who is chief executive of the Abu Dhabi Media Co., which recently signed a deal to spend $1 billion over five years to finance Hollywood projects. "It wants to invest in businesses that in 10 or 20 years will flourish and continue to sustain the economy of the UAE."
Investments that might not hold up on their own often have other long-term strategic implications.
"The people here are extremely intelligent. They know business," Borgerding said. "They know the value of money. They're not unsophisticated investors spending their money in a random way."
Evidence so far shows that the gulf states have mostly spent their oil windfall wisely, especially when compared with what even the U.S. presidential candidates are describing as the reckless behavior on Wall Street over the last few years.
