Soros "warned" that Europe has only three months to solve the crisis
Soros "warned" that Europe has only three months to solve the crisis
China Construction machinery information
Guide: those who can hear George Soros' kind warning are lucky, otherwise, like people in the pound crisis of the last century and the financial crisis in Southeast Asia, they may be looted. Now, the billionaire once again warned that the time to solve the euro zone crisis is only three months, otherwise time will be one
those who can hear George Soros' kind warning are lucky, otherwise they may be "robbed" like people in the pound crisis of the last century and the financial crisis in Southeast Asia. Now, the billionaire once again warned that there is only three months left to solve the eurozone crisis, otherwise governments will "be unable to turn back the day" after the time passes
"the European Monetary Union is a political foam"
last weekend, Soros said at an economic conference in Trento, Italy, "the eurozone authorities have only three months to correct the mistakes to ensure that their single currency can survive. After these three months, governments will not be able to meet the financing needs of the market."
when talking about the current situation in Europe, Soros stressed, "The European Monetary Union is like a foam, a political foam rather than a financial foam, and the European debt crisis may eventually explode in this form. Now it is very clear that the root cause of the European debt crisis comes from the right given by the eurozone member states to the European Central Bank to create legal tender, but they are not aware of the consequences. To solve this problem, the eurozone needs a guarantee plan for European banking deposits, while allowing The European stability mechanism (ESM) provides financing directly to the European banking industry and establishes a common financial supervision system hand in hand. "
Soros, who has always been at odds with Germany, did not forget to attack the Bundesbank this time (famous for anti inflation and caution). He believed that because Merkel was too cautious in supporting the euro zone, it was equivalent to creating obstacles to solving the European debt crisis. However, he also pointed out that Germany will eventually maintain the stability of the euro, otherwise once the Deutsche mark is restarted, the decline in exports and enterprise bankruptcy will lead to heavy casualties in its domestic banks
found that the attitude of Germany is not "stubborn". According to foreign reports, Merkel is promoting an unprecedented sovereignty transfer plan to reform the social security system and the job market. However, the implementation of this plan requires the consent of other member states. In addition, because Spain agrees to the unified management of Member States' finances in the euro zone, Germany has extended the deadline for Spain to reduce its deficit, which is also seen as one of the signs that Germany will deal with the European debt crisis more flexibly in the future
it is worth noting that at the beginning of November last year, Soros also used the term "three months". At that time, he pointed out that "the reduction of 50% of Greece's private creditors is actually less than 20% of Greece's total debt. Considering the severity of the crisis, the new euro zone agreement (the reduction of 50% of Greece's private creditors and the expansion of the euro zone rescue fund to 1trillion euros) can only be maintained for no more than three months." The subsequent facts once again proved Soros' foresight as a top investor. In December last year, the European Central Bank announced the provision of a three-year long-term refinancing operation (ltro), with a scale of 489billion euros, far exceeding market expectations; Two months later, bond investors agreed to write down Greek bonds by 53.5% of their face value, higher than the previously estimated 50%
recognized by two Nobel economists
it is worth mentioning that Soros' judgment seems to have been partially confirmed two days later. Yesterday afternoon, according to the Wall Street report, Germany is sending a strong signal that if European leaders are willing to transfer a considerable part of budget control to the EU, Germany will eventually support the European common bond or banking Union, including pressure resistance, tension resistance The shear strength and the mechanism of rock failure and cracking are in accordance with the strength principle. If countries accept Germany's conditions, the monetary union will be rewritten, which will be the boldest step taken by the EU since the introduction of the euro
"people reacted crazily to Soros' speech in Trento, Italy!" Joeweisenthal, a reporter from business insider, described it this way
it is worth noting that in this 4404 word speech, Soros repeated many of his previous views on the European debt issue, so in terms of substance, there is not much new; However, in terms of the attitude towards Germany, Soros said very clearly and urgently this time: "nothing can be done without Germany's support", "we need to try our best to persuade Germany to show leadership to maintain the once beautiful goal of the European Union. The future of Europe depends on it."
Soros also said, "At present, debtors in countries including Greece and Spain have been criticized too much, but in fact, creditors such as Germany, which actively integrates into the national platform for research and development of material genome engineering, must also bear today's situation. For a flawed system, a flawed agreement and a series of flawed policies, the core countries are responsible for the design and implementation. At present, European heavily indebted countries need to bear the heavy burden of borrowing costs Free from. There are many ways to reduce financing costs, but they all need active support from the Bundesbank and the German government. "
specifically, in terms of joint undertaking, Soros believes that what creditor countries should do includes offsetting the impact of the recession of debtor countries through appropriate economic stimulus. "(European) decision makers do not understand the essence of the European debt crisis; they think it is a fiscal problem, but in fact it is more a problem of banking and economic competitiveness. The mistake in understanding also led them to adopt the wrong response: you simply cannot reduce debt through austerity, but can only rely on economic growth to get out of the crisis."
Soros' view was also endorsed by paulkrugman and josephstiglitz, Nobel Laureates in economics. They also believed that adhering to the tightening policy when the current euro zone recession occurred was an "economic suicide" behavior, and the smaller absolute value of stimulus such as increasing government spending was defined as the valley policy, which was the only way for the euro zone to get out of recession. Although Merkel's opposition to the European Central Bank's easing policy and the issuance of Euro bonds is still tough, Soros believes that Germany will eventually take all necessary actions to preserve the euro zone. "Among them, the negative electrode materials of water-based batteries jointly developed with American companies, otherwise, German banks will suffer huge losses, and returning to the Deutsche Mark will make German exports unbearable."
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