Since the first of the year the stock market has dropped dramatically and there is much discussion about the distress that many of our financial institutions are experiencing. In recent weeks, several of our large banks, including Citigroup, Merrill Lynch and Bear Stearns, have sold major portions of their ownership to foreign investors, especially investors from the Middle East.

People have expressed concern about the threat of recession in the United States, especially when considered alongside the growing economic strength of China, Russia, India and other countries. And now it appears that our banks are being "bailed out" by foreigners.

America used to produce almost 40 percent of world gross domestic product (GDP), and now we produce less than 30 percent. Should we be worried about this?

In a word, no.

For years I have heard people express concern about the disparity of wealth. Americans were so much wealthier than other people, and it seemed so unfair. Substantial efforts were being made to help impoverished peoples throughout the world. Well, guess what? During the past several years hundreds of millions of people have been lifted from the grasp of poverty through free and open markets and governments loosening their controls over economic activity.

Of course, America's portion of the world economy is shrinking. But it is not because we are getting poorer; it is because many of the desperately poor people on the planet are getting richer. They still only have a fraction of our standard of living, but as they improve, America's portion of world wealth will go down.

But shouldn't we be concerned if Saudi Arabians become major investors in U.S. banks?

No. Most of the value of the shares sold to foreign investors derives from the value of the people working at those banks. It derives from the expertise, skill, professional relationships and knowledge of employees and managers. In a very real sense, most of the value of those shares walks out the door every evening.

If foreigners were to try to do something that would be seriously detrimental to the U.S., I believe most of those workers would walk out the door and not come back. The value of the shares would plummet. Besides, they are sending us billions of dollars of oil and other goods and services. What should we give them in exchange? I believe that offering revenues from our skills and expertise in exchange is a bargain.

In fact, foreigners are helping us in many ways. They offer high-quality products for much less than we can produce them ourselves. That improves our standard of living.

They also have positive impact on our interest rates. For example, when Chinese companies accept our dollars for their goods, they sell the dollars and buy their local currency to have the money to pay their workers. This would normally drive down the value of the dollars they are selling and drive up the value of their local currency they are buying. But that would make their workers more expensive in dollar terms. To prevent this, the Chinese government sells the local currency to the Chinese manufacturers and buys the dollars. This improves the value and buying-power of the dollar. The Chinese government then takes the dollars and lends them to us by buying Treasury bonds and other debts issued by Americans. That keeps interest rates low in the United States.