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Thread: Soros on Austerity in Europe

  1. #1
    Havakasha is offline
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    Soros on Austerity in Europe

    http://www.marketwatch.com/story/sor...me_latest_news

    Jan. 25, 2012, 9:51 a.m. EST
    Soros: Austerity fomenting Europe tensions
    Germans have been traumatized by inflation, billionaire says
    By Polya Lesova, MarketWatch



    DAVOS, Switzerland (MarketWatch) — Billionaire investor George Soros warned on Wednesday that the austerity Germany wants to impose on other euro-zone nations “will push Europe into a deflationary debt spiral.”

    Germans “have been traumatized by inflation and they don’t understand the threat that deflation can cause,” Soros told reporters at the annual meeting of the World Economic Forum in Davos. “There’s a shift in German thinking recognizing this isn’t working, but we’re quite far yet from abandoning this emphasis on inflation as the only threat to stability.”


    The euro zone’s sovereign-debt crisis is a major topic this year, with German Chancellor Angela Merkel due to give the opening address this evening and European Central Bank President Mario Draghi set to speak later in the week.

    Investors are closely watching talks between debt-laden Greece and private-sector creditors in which the two sides are trying to agree on a writedown of Greek debt that will be voluntary.

    “The big issue is how does the euro cope with the danger of a Greek default,” Soros said. “Because that is something that is looming — it may or may not be avoided.”

    Soros, an outspoken billionaire and philanthropist, gave a speech on the euro crisis and then took questions from reporters on a wide range of subjects, including China, the U.S., Russia, the Swiss franc and oil prices.

    Soros, who has written a new book on financial turmoil in Europe and the U.S., said that measures taken by the European Central Bank in December have relieved the liquidity problems of European banks, but “they did not cure the financing disadvantage from which the highly indebted member states suffer.”

    High risk premiums on Italian and Spanish bonds threaten the capital adequacy of banks and leave weaker euro-area nations “relegated to the status of third-world countries that became highly indebted in a foreign currency,” he said.


    Instead of the International Monetary Fund, “Germany is acting as the taskmaster imposing tough fiscal discipline,” Soros said. “This will generate both economic and political tensions that could destroy the European Union.”

    The billionaire investor said that fiscal discipline alone isn’t enough to solve the crisis and that the EU will have to provide stimulus to get out of the deflationary spiral. “This will require euro bonds in one guise or another,” he said.


    Click on link at top of page to read whole article.
    Last edited by Havakasha; 01-25-2012 at 11:58 AM.

  2. #2
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    Remember when people like SiriuslyWrong heaped praise on England's austerity program? It looks like now
    they are going to have stimulate their economy to try to fight an upcoming recession.

    http://news.yahoo.com/uk-economy-shr...104757197.html



    UK economy shrinks in Q4, raising recession fears
    By ROBERT BARR | Associated Press – 5 hrs ago
    Email

    LONDON (AP) — Britain's economy shrank by 0.2 percent in the last three months of 2011, official data showed Wednesday, a worse than expected result that raises fears of a recession and could see the Bank of England push for more monetary stimulus.
    The Office for National Statistics said that the economy, which had been expected to contract by only 0.1 percent, saw no growth in the key services sector and a slide in industrial activity.
    The GDP figures, which showed a meek 0.8 percent rise on the year, are subject to revision, but few analysts expect a marked improvement. Another quarter of negative growth would put Britain officially in a recession.
    "With the economy sticking one foot through the recession door in the fourth quarter of 2011, more quantitative easing from the Bank of England in February looks a done deal," said Howard Archer, chief European economist at IHS Global Insight.
    Quantitative easing is a stimulus program in which the central bank buys bonds and other high-quality financial assets from banks, increasing the amount of money flowing around the economy. The hope is that it will increase bank lending and, by extension economic activity.
    The Bank of England last increased its quantitative easing program by 75 billion pounds in October.
    Minutes of the last policy meeting, in January, showed that the nine members of the Bank's Monetary Policy Committee had been, as expected, unanimous in voting not to approve more stimulus.
    The Bank had indicated that it would take at least through January to spend the 75 billion pounds in asset purchases.
    Some of the MPC members are concerned about Britain's high rate of inflation, which was last measured at 4.2 percent, still twice the 2 percent target despite dropping in recent months.
    The minutes showed there some members worried that approving more monetary stimulus would slow the drop in consumer price inflation. Others wondered whether inflation was dropping so fast that more stimulus would be necessary to keep price increases close to the 2 percent target in coming months.
    Inflation tends to fall as economic activity drops, and the outlook is not good. The International Monetary Fund this week slashed its forecast for U.K. economic growth this year to 0.6 percent from 1.6 percent previously.
    Treasury chief George Osborne said Wednesday's figures were "not entirely unexpected because of what's happening in the world and what's happening in the eurozone crisis."

  3. #3
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    Nouriel Roubini:

    'The European Central Bank needs to act swiftly with "massive monetary easing" to prevent the crisis from deepening and austerity measures must be reined in, according to Roubini, in whose opinion the euro needs to be 20 percent or even 30 percent weaker to help the euro zone economies.'

    "There's a severe recession in the periphery of the euro zone," he said. "Less austerity, more growth, that's what the euro zone needs today."

    http://www.cnbc.com/id/46127687
    Last edited by Havakasha; 01-25-2012 at 03:03 PM.

  4. #4
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    Soros Warns of ‘Riots,‘ ’Brutal’ Clampdowns & Possible Total Economic Collapse

    George Soros is no stranger to Blaze readers. The billionaire currency speculator and philanthropist has long been in the news, especially since the fateful day in 1992 when he helped crash England's economy. In fact, since that day, he has been commonly referred to as “the man who broke the bank of England.”

    Soros is shrewd, he has a keen eye for investments, and he knows how to play the markets. Therefore, when he makes a prediction, it might be safe to say it's worth a listen. After all, his predictions (among other things) have made him the multi-billionaire he is today.

    So you might want to pay attention to a recent story from The Daily Beast that claims George Soros is nervous about the future of the global economy and that he warns of dark things to come.

    “At times like these, survival is the most important thing,” Soros said.

    As he sees it, the world faces one of the most dangerous periods of modern history—a period of “evil,” writes the Beasts' John Arlidge. “Europe is confronting a descent into chaos and conflict. In America [Soros] predicts riots in the streets that will lead to a brutal clampdown that will dramatically curtail civil liberties [emphases added]. The global economic system could even collapse altogether.”

    And to add a little color, Aldridge notes Soros says it all while "peering through his owlish glasses and brushing wisps of gray hair off his forehead."

    “I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” Soros told Newsweek. “We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse. The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of the financial system.”

    As mentioned in the above, and as The Daily Beast points out, Soros’ warning is probably based on his natural market instincts as well as personal experience.

    “I did survive a personally much more threatening situation, so it is emotional, as well as rational,” Soros said in reference to his personal experiences with both Nazi and Communist occupations.

    “The collapse of the Soviet system was a pretty extraordinary event, and we are currently experiencing something similar in the developed world, without fully realizing what’s happening,” Soros said.

    “Unrestrained competition can drive people into actions that they would otherwise regret,” Soros said. “The tragedy of our current situation is the unintended consequence of imperfect understanding. A lot of the evil in the world is actually not intentional. A lot of people in the financial system did a lot of damage without intending to.”

    Wait a minute. Soros believes that the economic meltdown was the result of not just poor investments but honest-to-God “evil”?

    “That’s correct,” Soros affirmed.

    Soros continued in this vein, each prediction getting darker and grimmer than the last.

    He believes that the EU must be held together because “if you have a disorderly collapse of the euro, you have the danger of a revival of the political conflicts that have torn Europe apart over the centuries—an extreme form of nationalism, which manifests itself in xenophobia, the exclusion of foreigners and ethnic groups."

    "In Hitler’s time, that was focused on the Jews," Soros said. "Today, you have that with the Gypsies, the Roma, which is a small minority, and also, of course, Muslim immigrants.”

    It is “now more likely than not” that Greece will formally default in 2012, Soros said. For this, he blames the EUs’ leadership and believes that eurozone leaders only know how to “do enough to calm the situation, not to solve the problem.”

    http://news.yahoo.com/soros-warns-ri...133218140.html

    What do you think of Soros now? He is now in the company of Gerald Celente.

    http://news.yahoo.com/soros-warns-ri...133218140.html

  5. #5
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    I think those of you who claimed, like Mr. Peter schiff and yourself that inflation was going to spiral out of control in 2011, because of Fed easing were incorrect. I also think that those of you calling for an austerity program in the U.S. would have brought on the kind of recessionary conditions that England and other countries are experiencing today. I think history will show you to have beenincorrect.


    There are a # of quotes in one of your articles that seem rather STRANGE.
    Here is but one example:

    What you have here is a sentence where you dont understand who is asking, and then
    a quote from Soros. Now is the description "gleefully" an actual quote from Soros
    or a description by someone else?



    As this anger intensifies, will the inevitable result be a spontaneous eruption of violence and riots?
    “Yes, yes, yes,” Soros says, almost “gleefully.”

    That is EXTREMELY odd.



    BY the way i am still waiting for you to supply the quote i requested last week of a statement
    you said President Obama made where he opposes the free market system and capitalism and
    says they dont work. Its disturbing that you have yet to back up your charge.
    Last edited by Havakasha; 01-26-2012 at 12:39 PM.

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  7. #7
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    I think those of you who claimed like Mr. Peter schiff and yourself that inflation was going to spiral out of control because of Fed easing were incorrect. I also think that those of you calling for an austerity program in the U.S. would have brought
    on the kind of conditions that England and other countries are experiencing today. I think history will show you to have been incorrect.
    Soros is a doom and gloom wack job just like Celente and even your favorite Schiff.

  8. #8
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    This is a thread about Soros. I have never heard of Celente and never put any articles by him on
    this site. I will try to read what he said shortly, but can you please stick to the
    Soros theme. Thanks.

    I hardly think Soros is a doom and gloom "wack job". He is well respected in the business and economic community. That is why his analysis is published in mainstream news sources quite frequently.
    Now Peter Schiff, who you brought to my attention and whose predictions and book you praised isclearly as I have shown a con artist who has NEVER admitted he made one mistake while I have demonstrated that he has dozens of wrong predictions.
    You once called his prediction that either "gold will rise to $12,000 or the Dow will drop to 1,400 in the next 2 years, "BOLD".
    Thats your quote.

  9. #9
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    This is a thread about Soros. I have never heard of Celente and never put any articles by him on
    this site. I will try to read what he said shortly, but can you please stick to the
    Soros theme. Thanks.

    I hardly think Soros is a doom and gloom "wack job". He is well respected in the business and economic community. That is why his analysis is published in mainstream news sources quite frequently.
    Now Peter Schiff, who you brought to my attention and whose predictions and book you praised isclearly as I have shown a con artist who has NEVER admitted he made one mistake while I have demonstrated that he has dozens of wrong predictions.
    You once called his prediction that either "gold will rise to $12,000 or the Dow will drop to 1,400 in the next 2 years, "BOLD".
    Thats your quote.
    Proof you don't read other's posts. I've posted on Celente DOZENS of times. Leave the lying to politics.

    Soros predicts some nasty things, and you highly respect him - you say so above. Says a lot about your character.

  10. #10
    Havakasha is offline
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    I do think that this quote is a rather accurate description of what went on in the past years. I dont think its "wacky" at aall.


    “Unrestrained competition can drive people into actions that they would otherwise regret,” Soros said. “The tragedy of our current situation is the unintended consequence of imperfect understanding. A lot of the evil in the world is actually not intentional. A lot of people in the financial system did a lot of damage without intending to.”

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