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Now taking questions (live here) after a speech in Berlin, George Soros says - absent policy...

Now taking questions (live here) after a speech in Berlin, George Soros says - absent policy actions taken to generate growth - the depression much of the EU is suffering through will reach Germany in 6 months. Germany must back growth or leave Europe, he says. Soros this weekend.
Comments (25)
  • I'd recommend they leave the EU. Let Club Med have their holiday in the sun.
    10 Sep 2012, 02:51 PM Reply Like
  • Clueless people usually don't know that Germany only did so well by fleecing club med with its overpriced goods (thanks to Euro) and stealing their deposits.


    Germany would be the biggest loser in an Euro breakup.


    German mainstream politicians know this and will never let this happen. But Commies and Nazis would fully relish in the ensuing chaos, and they are the ones asking the German Supreme Court to block the ESM.
    10 Sep 2012, 10:28 PM Reply Like
  • Dividend, are you suggesting that club med people are stupid?


    BTW, Eric Holder, is now investigating your charges...
    11 Sep 2012, 02:44 AM Reply Like
  • Are you for real? Your Nazi talk puts you squarely into the loonie department. Since the majority in Germans want the ESM blocked, you are indirectly calling the majority of Germans Nazis.


    Your post should be reported.


    In a global competitive market there are no "overpriced" goods - at least not those that get purchased. If you think German goods are too expensive, why were they bought? Ummm let me think... maybe because they work? Are more reliable, better than similar peripheral goods? Or *gasp* are actually cheaper than peripheral goods made by the overpriced peripheral workforce.


    Ironic to see the palpable nationalistic hatred towards the only country that is not only paymaster for the debt-fuelled peripheral party of the last 12 years you so enjoyed, but the only larger € nation to give this whole pile of poo some semblance of credence.


    Germany does not "need" the periphery to have a working economy. It's exports to the periphery are important, but not vital. Anybody who takes a closer look will notice how global market growth for German products has taken a lot of the sting out from the reduction in peripheral consumption .


    The periphery however very much needs debt to keep their economies going. Countries that would go bust NOW if it weren't for the Euro. Italy and Spain are paying interest rates that are much less than they were before the Euro - go thank Germany for that, oh wait you're too consumed by hatred to notice. Spanish bonds are being dropped by foreign investors as if covered in pest and cholera pathogens. Real wages in Italy and Spain would be 50% lower, GDP 20% lower and everything with a third of the infrastructure.


    The ESM and bond buying programmes guarantee the debt party will continue for the periphery - at the expense of the European core taxpayer - the same taxpayer who has seen his real disposable household income shrink by up to 30% (see Austria 2000-2012) during the time the peripheral household saw its income rise by 30% (see Greece, Spain).


    How do people expect "sterilised" bond purchases to happen? It can only work if peripheral bonds are bought, while other bonds are sold (highly likely) - so as not to expand money supply and to also further reduce the spread in interest paid between sovereign bonds. Guess which bonds will get sold - those of countries that did not partake in the debt party of the last 12 years and did not have the luxury of massive wealth expansion. Yes, core countries like Germany and Austria will see their debt costs rise, which means less money for things that could have been beneficial for these countries. A clear transfer of wealth to countries that despise their paymasters.


    Shame on the core taxpayer to baulk at having to pay for this mess while not even having had the democratic choice.


    Draghi opposes market forces, he is destroying the price mechanism which is the key component of every free market driven economy. Prices that reflect the country's solvency and sustainability. Without that, we are no better than communist central planning and we all know how well that ended.


    My greatest wish is for this mess to end as soon as possible. If a foreign country wants to retire at 60, fine let them, but not with my taxes - especially when I can only retire in my late sixties, yet pay +50% income tax.
    11 Sep 2012, 04:12 AM Reply Like
  • ESM was approved in Bundestag by 504 to 97, where most of NO votes came from the Left Block (Commies) and the far right of CSU (pretty close to Nazis), and they are the ones who represented the bulk of complainers in front of the Bundesverfassungsgericht.


    I looked more into this Peter Gauweiler dude. It seems that he was for locking up AIDS patients into camps, honoring the Wehrmacht, and refusing to return Nazi loot to their rightful owners. (
    11 Sep 2012, 05:16 AM Reply Like
  • CSU are the Bavarian centre right conservative sister party to the CDU and the largest party in that province. Please inform yourself properly before making any outrageous claims.


    Latest representative polls on ESM and bond buying bailout put well over 50% of all Germans into the "no" camp on all counts.


    How politicians vote at present has sadly little correlation to what the people in Germany want. That is why there is such outrage amongst those who care.


    The other points on Gauweiler are


    1. not content of this discussion
    2. outdated
    3. torn out of context and misrepresented
    4. a wikipedia source. Need I say more.
    5. what translation did you use? some points are the exact opposite of what you claim or are just plain wrong - see Nazi loot -> actually Soviet loot.


    Honestly, your claims are beyond ludicrous.
    11 Sep 2012, 05:46 AM Reply Like
  • Schatzi, post of the month! Your arguments are simply superb!!


    Apparently, Dividend, has to find a boggy man and that is Germany..


    Never mind examining the defaulting nations, as they could not yelp themselves..
    11 Sep 2012, 08:59 AM Reply Like
  • blueice, agree completely, i think dividend_growth is expecting some bad news and is preparing the ground to blame germany...
    11 Sep 2012, 07:14 PM Reply Like
  • A M have you heard that Merkel has changed her mind and wants to keep Greece in the EU? To keep the Euro from going up plus all the banking mess from being aired in Public I bet. Having all the debt, the CDos, and all the back room manipulation see the light of day for the first time. That might trigger a real Black Swan event since the cards will have to be shown to the public. Can not wait to see what happens one way or the other. Best Wishes
    11 Sep 2012, 09:06 PM Reply Like
  • dividend_growth - I don't disagree that they are going to lose if they leave the monetary union. Whether they stay or leave really depends on whether it was a good idea to begin with and whether it can be saved. I think the answer to both of those is no, and some of the German people I am associated with also feel this way. The more leverage and backstopping they do of Club Med, the worse off they are going to be when it implodes. So the point is, they will lose MORE if they stay in the union than if they leave. Germany will not be unharmed by this whatever they do, but they will dig themselves out more quickly and with far less damage if they leave.
    12 Sep 2012, 05:29 PM Reply Like
  • Germany leaving is the only way to solve the crisis. The euro would drop 20-30% overnight, dramatically reducing Mediterranean debt's real value. Then the south could turn on the printing presses. All holders of euros and euro denominated debt would take a haircut, but we'd be a lot closer to a real recovery. Meanwhile the rank and file germans would get their beloved deutschmark back but find out it will reduce demand for their products around the world. Europe would be out from the spectre of this economic conquest by Germany which is the inevitable logic of the status quo.


    Foolishly, the current plan is to drop out the worst performing countries one by one and watch them inevitably default. Greece is small. But if Spain, Italy or France leave, the value of the Euro would rise, worsening the debt problem. Redenomination of bond debt from euros to national currencies would be inevitable as the value of the euro rose with every exiting country. That would be a legal and financial nightmare.


    The euro is meant to be the currency of most of europe, not a financial torture device controlled by Germany. If the euro cannot serve the needs of Spain, Italy and France, it really won't last long.


    Lastly, "financial repression," that is the priviledge of states to debase coinage and paper currency is age old and should be expected. When England's debts got too large, kings have always found ways to debase the value of those debts. Inflation and money-printing are part of any modern financial system and economic growth. I am certain, if history is any guide, these techniques will be involved in a solution to the developed world's debt problems. the only question is how to do it with the least disruption and pain for the most economies.
    10 Sep 2012, 04:58 PM Reply Like
  • "how to do it with the least disruption and pain for the most economies."


    Good luck with searching for the MMT'er nirvana. It doesn't exist (perfect soln fallacy). Neither do perpetual motion machines or Maxwell's demon(s). But being a socioeconomic engineer must be fun, eh?
    10 Sep 2012, 06:23 PM Reply Like
  • Soros punishing the Germans.


    "Soros singled out Germany as the country that should take responsibility for [the] "class divide" in the eurozone."


    "Soros called on Germany to show leadership by establishing a "more or less level playing field" between debtor and creditor countries, and aiming for eurozone growth of up to 5%, "allowing Europe to grow its way out of excessive indebtedness". But, he said, "this would entail a greater degree of inflation than the Bundesbank is likely to approve".


    Alternatively, he said, with Germany out of the euro, the currency would depreciate, cutting national debts in real terms and allowing debtor countries to regain competitiveness."
    10 Sep 2012, 05:59 PM Reply Like
  • Soros seems to believe that by tearing down the German economy it will somehow solve the problems in some of the European countries which now have to borrow money to pay the interest on their debts. I do not understand his logic.


    If Soros so firmly believes that the successful parts of Europe should impoverish themselves in some vain attempt to bail out the southern tier of the Eurozone, then I suggest that Mr. Soros lead by example. He could start by bailing out his native Hungary.
    10 Sep 2012, 11:35 PM Reply Like
  • a socialist country being taken to task
    for not being "socialistic" enough.
    go figure.
    by the way, the euro is the deutschmark
    10 Sep 2012, 07:09 PM Reply Like
  • Germany is carrying the Euro and Soros who never liked them anyways wants them to carry more weight. And Soros is probably just setting up a trade anyways so how does he get away with running his mouth?


    Just another John Corzine.
    10 Sep 2012, 07:40 PM Reply Like
  • You can't possibly compare Soros to Corzine, because Soros is a real shark and Corzine is a true idiot (and criminal).
    10 Sep 2012, 10:30 PM Reply Like
  • To a certain degree yes. However if we had a justice department that had any brains I am sure they could find Soros crossing the law also but they are too stupid to figure it out. Or should I say they don't want to know because he is a big Dem or at least sympathetic to the tax and spend crowd.
    11 Sep 2012, 10:02 AM Reply Like
  • This guy has obviously got a huge play on the euro not going down the tubes. Simply talking his book. Economies like Germany will not go into depression. Germany can simply leave the currency peg called the Euro and let the beggars who remain to pick up the pieces.


    Hopefully Soros will get his lunch handed to him and Germany, being the only economy where work still gets performed won't get sucked into this any further.
    10 Sep 2012, 09:39 PM Reply Like
  • Germany parachutes out of the Euro the plane crashes chute doesn't open lands very hard... Decade to recover.
    10 Sep 2012, 09:46 PM Reply Like
  • Say what you will but Soros has put two solutions on the table. Either inflate the Euro with Germany or without Germany. What path will Europe choose. Either way someone has to pay for the losses. Who do you think that will be?
    10 Sep 2012, 10:14 PM Reply Like
  • Here's what I thought was the most interesting thing in Soros's rather long article:


    If you take the EMU, and cut out Germany and look at what's left, then the remaining countries put together actually have lower debt/GDP and lower government deficits/GDP than either the US, Japan, or Great Britain.


    Chew on that . . .
    10 Sep 2012, 11:02 PM Reply Like
  • Pete123 that is interesting yet they will find a way to mess that up. Best Wishes
    11 Sep 2012, 04:21 AM Reply Like
  • the best prediction of the future is past behavior, UK had much higher debt levels than now after WW2 but managed to avoid: coups, communist takeovers, hyperinflations, and starting wars they lost


    the anglosphere has a unique history of avoiding hyperinflations and constitutional collapse... japan and europe, they specialize in those...
    11 Sep 2012, 07:19 PM Reply Like
  • Do German banks still have money left on the Euro-table? I guess they need the ECB (=other national CB's) and other well-doing Euro-countries to help get their banks back in the dry. What I don't understand is what the other countries are getting out of this. Remember the TARGET2-balance, the south now owes north big time.


    Seems that the sensible thing to do if there were no more liabilities, would just be to exit the whole thing, because the losses might be smaller that way than funding the club Med in the long term. Unless of course it's about more than economics and Germany is building the fourth Reich.
    11 Sep 2012, 04:29 AM Reply Like
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