George Soros wants China to revalue its currency
January 27, 2010 3:20pm
by John Gapper
It was a sprightly and cheerful George Soros who addressed journalists at a lunch today in Davos on the aftermath of the financial crisis.
The crisis has been good for the credibility of Mr Soros and he drew a notable group of editors to listen to his recommendations, including John Micklethwait of The Economist, James Harding of The Times, Jacob Weisberg of Slate and Marcus Brauchli of The Washington Post.
The areas he focussed on most included US regulatory reform and the revaluation of the Chinese currency to restrain inflation.
On China, he raised concerns about potential over-heating of the economy and inflation as a result of its fiscal stimulus:
“The Chinese government was successful going into the crisis . . .Now they have thrown everything they can into stimulating the economy and the economy is taking off and credit demand is very high and they must restrain it.
“China is running a fabulous surplus and dealing with the overheating of Chinese economy by allowing the currency to rise is probably the best from Chinese point of view, it is certainly best from the global point of view. The case for revaluing the renminbi is getting stronger and stronger.
“The imbalance come from the RMB being fixed to dollar. That is an imbalance that ought to be corrected right now. China has an inflation problem that it has to deal with and allowing the currency to appreciate would be a very effective way of dealing with it.”
On the “Volcker rule” announced by Barack Obama last week to split proprietary trading and hedge funds and private equity from deposit-taking banks:
“I am very supportive of it but I don’t think it actually goes far enough . . . Some of the banks will spin off their investment banks and those will be very substational and they will be too big to fail, so the too big to fail problem still remains. The idea that thought resolution authority and other measures can allow those banks to fail is not credible.
“When the system is in danger the authorities have always extended their intervention beyond the area which they control to a blanket reassurance that no institution that could endanger the system will be allowed to fail. That implicit guarantee is out there and to claim it isn’t is not credible.
“I think the banking community that is opposing [reform] is tone deaf. If you talk to individual bankers, they will say something like this is necessary.”
Been wonder when ol' George would show up....he was the person that broke the bank of england years ago....bet ya a dinar he is behind china asset bubble!!!
January 27, 2010 3:20pm
by John Gapper
It was a sprightly and cheerful George Soros who addressed journalists at a lunch today in Davos on the aftermath of the financial crisis.
The crisis has been good for the credibility of Mr Soros and he drew a notable group of editors to listen to his recommendations, including John Micklethwait of The Economist, James Harding of The Times, Jacob Weisberg of Slate and Marcus Brauchli of The Washington Post.
The areas he focussed on most included US regulatory reform and the revaluation of the Chinese currency to restrain inflation.
On China, he raised concerns about potential over-heating of the economy and inflation as a result of its fiscal stimulus:
“The Chinese government was successful going into the crisis . . .Now they have thrown everything they can into stimulating the economy and the economy is taking off and credit demand is very high and they must restrain it.
“China is running a fabulous surplus and dealing with the overheating of Chinese economy by allowing the currency to rise is probably the best from Chinese point of view, it is certainly best from the global point of view. The case for revaluing the renminbi is getting stronger and stronger.
“The imbalance come from the RMB being fixed to dollar. That is an imbalance that ought to be corrected right now. China has an inflation problem that it has to deal with and allowing the currency to appreciate would be a very effective way of dealing with it.”
On the “Volcker rule” announced by Barack Obama last week to split proprietary trading and hedge funds and private equity from deposit-taking banks:
“I am very supportive of it but I don’t think it actually goes far enough . . . Some of the banks will spin off their investment banks and those will be very substational and they will be too big to fail, so the too big to fail problem still remains. The idea that thought resolution authority and other measures can allow those banks to fail is not credible.
“When the system is in danger the authorities have always extended their intervention beyond the area which they control to a blanket reassurance that no institution that could endanger the system will be allowed to fail. That implicit guarantee is out there and to claim it isn’t is not credible.
“I think the banking community that is opposing [reform] is tone deaf. If you talk to individual bankers, they will say something like this is necessary.”
Been wonder when ol' George would show up....he was the person that broke the bank of england years ago....bet ya a dinar he is behind china asset bubble!!!