Billionaire investor George Soros is sounding the alarm. In a recent talk given at an economic forum in Sri Lanka Soros declared that the current global financial climate is very reminiscent of the financial crisis that happened in 2008.
A Bloomberg article has quoted George Soros as saying there is a “serious challenge” facing the world financial markets. He points to China’s current economic problems as a catalyst for a possible global crisis.
According to Soros, China’s economy is shifting from investment and manufacturing and moving torawds services and consumption. It is this environment that has caused China’s stock market to plunge and has contributed to a $2.5 trillion loss for world equities. The devaluation of the yuan, China’s official currency, has also added to China’s economic woes.
In response, China’s government has pledged to stabilize the yuan by 2020 and to gradually get rid of capital controls. The People’s Bank of China has already cut interest rates to record lows but the country’s economy remains sluggish.
Soros added that China’s adjustment problem “amounts to a crisis.” This is not the first time that Soros as raised concerns about global financial markets. Back in 2011 Greece debt crisis he also said those circumstances reminded him of 2008.
Soros’s hedge fund has averaged a total return of 20% per year since its inception in 1969 to 2011. According to the Bloomberg Billionaire Index Soros has a net worth of approximately $27.3 billion.
George Soros currently spens the majority of his time running his Open Society Foundation which strives to strengthen human rights and hold governments around the globe accountable for their treatment of citizens. He also continues to speak about global economic issues and is a sought after consultant and adviser to governments around the world.
He is most famous for netting $1 billion by betting against the British Pound and forcing the U.K. government to devalue its currency.