The healing of the banking system and housing markets is crucial to recovery. "The banking system, as a whole, is basically insolvent," Soros said.
What's more, the Treasury's Public-Private Investment Fund is going to work but it won't be enough to recapitalize the banks in a way that they are able to or willing to provide credit.
"What we have created now is a situation where the banks who will be able to earn their way out of a hole, but by doing that, they are going to weigh on the economy," he said. "Instead of stimulating the economy, they will draw the lifeblood, so to speak, of profits away from the real economy in order to keep themselves alive. This is the zombie bank situation."
The stress tests being conducted by Treasury could be a precursor to a more successful recapitalization of the banks, he added.
Dollar is Vulnerable
Soros, whose latest book, "The Crash of 2008 and What it Means," has made prescient calls during the current credit crisis.
Exactly one year ago, he told Reuters that global losses are likely to top $1 trillion from the credit crisis. To date, U.S. and European banks have recorded more than $700 billion in losses and write-downs, as of Feb. 5. 2009, according to Reuters data.
Soros also said the U.S. dollar is under selling pressure and may eventually be replaced as a world reserve currency, possibly by the IMF's Special Drawing Rights, a synthetic currency basket comprised of dollars, euros, yen and sterling.
"I think the dollar is now under question and I think the system will need to be reformed, so that the United States will be subject to the same discipline as is imposed on other countries," said Soros, whose famous bet against the British pound earned his Quantum Fund $1 billion in 1992. "Being the main issuer of international currency, we have been exempt and we have abused that because we have effectively consumed 6.5 percent more than we have produced. That is now coming to an end."
7 comments:
Ah, George Soros, the exemplary self-loathing Jew.
When he was in eastern europe he betrayed the jews to the germans
Then he hated the russians.
Now he hates us.
He almost destroyed the monetary system of Maylasia/Thailand SE Asia
He is smart
Talented
Understands the niches of finance and where to get himself and his clients the unfair edge ...
BUT HE PRODUCES NOTHING
HE CAN MAKE MONEY ON DECAY, LIKE A MAGGOT
HE CAN BRAY ABOUT SOCIAL JUSTICE, AND INVENT OSI, SUPPORT MOVEON, BUT WHO CAN BELIEVE ANYTHING MORE THAN THAT THIS WILL MORE RELIABLY ALLOW HIM TO PICK AT ECONOMIC CORPSES?
This is what the far left liberals want.
They want our money to be worthless. Once it is completely worthless, a new currency will come into play. Everyone will be given the same amount of that new currency. We will then have full and complete socialism in America, if this happens.
Debra J.M. Smith
Informing Christians
DEBRA IS CORRECT, AND SOROS IS A BIG BACKER OF OBAMA TO DO JUST THIS.
BUT ALSO, SOROS IS BUYING UP BANKS.
HE BOUGHT INDYMAC BANK.
HE'S LIKE POTTER IN IT'S A WONDERFUL LIFE.
Epa,
You'll be happy to know that our beloved Secretary of Defense, Robert Gates, has called for F-22 production to be phased out by 2011. That would leave us about 187 F-22s, about half the original envisioned production line. The future of the USAF looks grim.
http://www.cnn.com/2009/POLITICS/04/06/gates.budget.cuts/index.html
Reliapundit,
I'm surprised to hear that you agree with Debra.
Here's a Biblical verse for you to consider. You and I discussed this the other day:
"6He also forced everyone, small and great, rich and poor, free and slave, to receive a mark on his right hand or on his forehead, 17so that no one could buy or sell unless he had the mark, which is the name of the beast or the number of his name.
18This calls for wisdom. If anyone has insight, let him calculate the number of the beast, for it is man's number. His number is 666."
"9A third angel followed them and said in a loud voice: "If anyone worships the beast and his image and receives his mark on the forehead or on the hand, 10he, too, will drink of the wine of God's fury, which has been poured full strength into the cup of his wrath. He will be tormented with burning sulfur in the presence of the holy angels and of the Lamb. 11And the smoke of their torment rises for ever and ever. There is no rest day or night for those who worship the beast and his image, or for anyone who receives the mark of his name." 12This calls for patient endurance on the part of the saints who obey God's commandments and remain faithful to Jesus.
13Then I heard a voice from heaven say, "Write: Blessed are the dead who die in the Lord from now on."
"Yes," says the Spirit, "they will rest from their labor, for their deeds will follow them.""
"2The first angel went and poured out his bowl on the land, and ugly and painful sores broke out on the people who had the mark of the beast and worshiped his image."
"20But the beast was captured, and with him the false prophet who had performed the miraculous signs on his behalf. With these signs he had deluded those who had received the mark of the beast and worshiped his image. The two of them were thrown alive into the fiery lake of burning sulfur."
"4I saw thrones on which were seated those who had been given authority to judge. And I saw the souls of those who had been beheaded because of their testimony for Jesus and because of the word of God. They had not worshiped the beast or his image and had not received his mark on their foreheads or their hands. They came to life and reigned with Christ a thousand years."
Notice two things:
1) It says all people all over the planet will be forced to take the mark to "buy or sell". This could only happen in our time, with computer technology.
2) It says, "those who were beheaded because of their testimony ..." (that is a pretty prominent clue, given that the only people who do such things in this time are Muslims).
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