Market in fear of government shopping

Financial market has been in high alert against the growing trend of goverments going shopping. As a new market player, government seems to be something indomitable, injecting growing fear into the market. One of the major concerns, according to the latest issue of the Economist, is its murkiness of the so-called sovereign wealth fund, which in turn leads to unpredicability.
It reminds me of the private equity, which has been under fire for its similar murkiness. Yesterday's Financial Times reported that private equity funds will be forced to reveal more sensitive information, and a strategy of naming and shaming will be taken against them.
Interestingly, both private equity fund and sovereign wealth fund could make big impact on the financial market, but both could bring great uncertainty to the market. Thats why people are so vigilant against them.
Therefore regulation seems to be necessary, but in practice, it could be quite tricky. For the private equity, the regulation could drive them away from the Britain and go to other hunting ground where the regulation is lax. Regulatory competition could often lead to the so-called "race to the bottom" unless there is a uniform act.
For the sovereign wealth fund, the regualtion appears to be a much harder act., as the player behind the fund is nothing but sovereign government. German Chancellor Merkel has been seeking to restrain the government shopping, but the proposal could meet with strong resistance with the UK government, which has been quite happy to give green light to the deal in which Chinese Development Bank bought shares from Barclay.