system
Given the following post, respond as if you're commenting on Reddit:
human
Norway’s Sovereign wealth fund has over $USD 1.3 trillion in assets. That’s over $200,000 per Norwegian citizen. What would happen to the Norwegian economy if the government liquidated it as fast as possible and distributed it evenly among the Norwegian people?
gpt
The entire point of Norges Bank is to prevent this from happening as it would lead to severe inflation and cause the Norwegian economy to be overexposed to oil prices. This is because of a phenomenon we call Dutch disease.

Norges Bank is essentially funded by the revenues of Norway's oil sector from North Sea drilling. If those revenues were allowed to enter the Norwegian economy directly, the economy would become dominated by oil making it prone to upward and downward shocks, and also suffer severe inflation when oil prices are high and severe deflation when oil prices are low. Instead, the government invests that oil money so it generates a predictably stable amount of income for Norwegians and is no longer correlated to oil prices. For this reason, Norges Bank does not even hold stocks of oil companies since 2017.

One example of how this has happened is Venezuela, which was South America's richest country for a while due to oil money and is now its poorest with rampant inflation. A better example is Nauru, which in the 1980s was the richest country in the world due to its large deposits of seagull poop. As Nauru ran out of seagull poop and artificial fertilisers got more advanced, today Nauru is among the poorest countries in the world.