George Soros speech on The Eurozone Crisis in The Festival of Economy Trento Italy 02/06/2012

George Soros speech on The Eurozone Crisis in The Festival of Economy Trento Italy 02/06/2012

George Soros :" Ever since the Crash of 2008 there has been a widespread recognition, both among economists and the general public, that economic theory has failed. But there is no consensus on the causes and the extent of that failure. I believe that the failure is more profound than generally recognized. It goes back to the foundations of economic theory. Economics tried to model itself on Newtonian physics. It sought to establish universally and timelessly valid laws governing reality. But economics is a social science and there is a fundamental difference between the natural and social sciences. Social phenomena have thinking participants who base their decisions on imperfect knowledge. That is what economic theory has tried to ignore. Scientific method needs an independent criterion, by which the truth or validity of its theories can be judged. Natural phenomena constitute such a criterion; social phenomena do not. That is because natural phenomena consist of facts that unfold independently of any statements that relate to them. The facts then serve as objective evidence by which the validity of scientific theories can be judged. That has enabled natural science to produce amazing results. Social events, by contrast, have thinking participants who have a will of their own. They are not detached observers but engaged decision makers whose decisions greatly influence the course of events. Therefore the events do not constitute an independent criterion by which participants can decide whether their views are valid. In the absence of an independent criterion people have to base their decisions not on knowledge but on an inherently biased and to greater or lesser extent distorted interpretation of reality. Their lack of perfect knowledge or fallibility introduces an element of indeterminacy into the course of events that is absent when the events relate to the behavior of inanimate objects. The resulting uncertainty hinders the social sciences in producing laws similar to Newton’s physics..........."

George Soros Pushes for Eurobonds

George Soros urged the Eurozone to start a new fund to buy Italian and Spanish bonds paid for by issuing so-called Eurobond. German Chancellor has already ruled that out. Germany's stance on Eurobonds could force Greece out of the euro.


Michael McKee -

"George Soros is going to be very disappointed. It's not going to happen. The things he is talking about are going to take a very long period of time. Investors want to know what's the short-term that will get us to the medium-term! The Europeans don't have anything to address those questions"


[Is this EU 2-day Summit going to accomplish somehow what some of the other meetings have not?]

"No it's not [Beautiful]. It's the 19th meeting they've had since the beginning of the crisis. It's going to end like all the others. With a statement saying we've made incremental progress on these things, we're getting there but it's important for Greece to stick to its austerity program. They're going to keep talking. There are no grounds for a breakthrough".