But the dollar maintained its global dominance, and the Saudis turned out to have strong financial incentives for keeping the overwhelming bulk of their wealth in dollar-denominated investments. Oil revenue to the tune of $100 million a day was pouring into the Saudi Arabian Monetary Agency (SAMA), the nation’s central bank, whose decision-making process is illuminated in a memoir,
Packing for India, by David Mulford, one of a handful of foreigners hired by SAMA in the mid-1970s as an adviser. SAMA’s dilapidated offices typified the desert kingdom’s detachment from modernity — communication with the outside world was limited to a single balky telex machine, according to Mulford (who later became US Treasury undersecretary for international affairs). And Mulford recalled that in addition to the constraints imposed by antiquated technology, SAMA’s investment choices were dictated to a significant extent by liquidity — that is, the ability to buy or sell without causing prices to change significantly.