In 15-minute interview, George Soros discusses everything macro:
His comments:
His comments:
- United States attempting a delicate maneuver of first flooding the economy with money and now removing it
- European debt crisis is much bigger problem because those countries can’t issue their own currency while the United States can. The individual states in America, however, are in a position similar to the European countries
- Believes threats of U.S. debt are overblown, believes they could absorb more debt to get economy going
- Any additional debt should be used for infrastructure creation
- ECB only directive to prevent inflation
- United States Fed more interested in both preventing inflation and creating jobs
- Believes U.S. dollar no longer the reserve currency, believes commodities including gold and oil become a store of value, this type of demand creates upward pressure on commodities
- Commodities including oil and food prices rising have induced ECB to raise rates, perhaps mistakenly
- China has stimulated economy very successfully and is now trying to slow it down. Constraints on banking system in China are meant to cool economy, but a shadow banking system is replacing their lending and growing out of control.
- Sees China having problems with wage inflation. Believes they have made a mistake by not allowing currency to appreciate which would have curbed price inflation
- China was major beneficiary of globalization and a big winner in the financial crash because their economy was largely insulated. China's system is different from the international system, as the Chinese state controls the economy instead of allowing complete free movement of capital. This is what made them largely immune to the financial crisis.
- Other countries such as Brazil are now starting to follow the Chinese model
