Many are feeling concerned about a prediction that George Soros recently made on Bloomberg. While speaking at an economic forum in the capital of Sri Lanka, he mentioned that the devaluation of China’s currency is hurting the rest of the world. He says that the crisis in the global market mirrors that which took place in 2008. He warns investors to be cautious.
George Soros started his career in the 1950s while living in New York City. During the 1960s, he set up a hedge fund firm that has been extremely successful. In fact, it has gained about 20 percent annually since the time it opened. Many individuals view George Soros as a well respected investor and take his opinions seriously. They have seen that other predictions he has made have come true. For example, in the early 1990s, he predicted that the United Kingdom would have to devalue the pound. Not only did this proved to be true, but George Soros walked away pocketing about $1 billion because of it. His investing prowess has earned him much respect.
One of the problems that George Soros points out is that the country of China is having a difficult time finding a new growth model. The fact that their currency is going down in value is affecting the economy of the rest of the world. He pointed out in his speech that returning to positive interest rates is a challenge for any country, but it is especially challenging in the developing world. One of the reasons why he feels that China’s economy is weakening is because it has shifted from investment and manufacturing toward services and consumption.
There are a couple of different steps that the government of China and other institutions in China are taking to remedy the problem. For example, the People’s Bank of China has cut interest rates for those who wish to borrow money. This will boost the economy. Also, China’s Communist Party has made plans to increase the convertibility of their currency in the next four years.
This is not the only time that George Soros has said that a financial crisis mirrored that which took place in 2008. During the fall of 2011, George Soros said that the situation that was taking place in Greece was even worse than what happened to the world’s economy in 2008.
George Soros has worked hard to do good for others. Ever since the time he started his career, he has felt that it was his responsibility to take a stand on controversial issues and do good for others. One of the ways that he has done this is by promoting the idea of open society, which means all have their rights respected.