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Monday, January 28, 2013

George Soros from Davos Issues Euro Warning

George Soros : “Germany did the minimum that was necessary to save the euro,” he said. The result now is that the Eurozone is effectively divided into creditors (countries like Germany, Holland, and the Scandinavia countries) and debtors (Greece, Spain, Italy, Portugal, Ireland). “The creditors are in charge, and are unfortunately arguing for a policy of austerity, which is counterproductive,” he said. While the ECB and IMF have made budget cuts and tax increases a condition of receiving aid, he notes “you can’t reduce excessive debt by reducing the GNP.” He said austerity is pushing the eurozne into recession, which will further aggravate political tensions. The danger now is that the European Union, a voluntary association of equal states, is in danger of devolving into a system “where Europe is divided into the center and the periphery, with the center controlling policy and the periphery used to a permanently inferior and subordinate situation." - in thedailybeast

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George Soros was born in Budapest, Hungary, in 1930. His father was taken prisoner during World War I and eventually fled from captivity in Russia to reunite with his family in Budapest. Soros was thirteen years old when Hitler's Wehrmacht seized Hungary and began deporting the country's Jews to extermination camps. In 1946, as the Soviet Union was taking control of the country, Soros attended a conference in the West and defected. He emigrated in 1947 to England, supported himself by working as a railroad porter and a restaurant waiter, graduated in 1952 from the London School of Economics, and obtained an entry-level position with an investment bank.

In 1956, Soros immigrated to the United States, working as a trader and analyst until 1963. During that time, he developed his own theory of markets called 'reflexivity', which he has laid out in his recent books THE ALCHEMY OF FINANCE and THE CREDIT CRISIS OF 2008 AND WHAT IT MEANS. In 1967 he helped establish an offshore investment fund; and in 1973 he set up a private investment firm that eventually evolved into the Quantum Fund, one of the first hedge funds, through which he accumulated a vast fortune.