Soros warns of three-month window to save the single currency
The billionaire finance sage George Soros has told Germany it has three months to save the euro – and prevent the disintegration of the European Union.
Only a German volte face on policy by the end of September could prevent a messy and potentially catastrophic break-up of the single currency, and the EU itself, the financier, pictured, said in a speech to the Festival of Economics, in the Italian city of Trento.
"In my judgement the authorities have a three-month window during which they could still correct their mistakes and reverse the current trends," said Mr Soros, known as the "man who broke the Bank of England" after making a £1bn profit from the UK exit from the Exchange Rate Mechanism in 1992. "By 'the authorities' I mean mainly the German government and the Bundesbank because in a crisis the creditors are in the driver's seat and nothing can be done without German support."
His comments will add to the pressure on Germany to relax controls over the European Central Bank and make growth the top priority.
He said European governments had failed to comprehend the nature of the euro crisis. "They thought it was a fiscal problem while it is more of a banking problem and a problem of competitiveness," he said. "And they applied the wrong remedy: you cannot reduce the debt burden by shrinking the economy; only by growing your way out of it."
He added: "The crisis is liable to come to a climax in the autumn. By that time the German economy will also be weakening so that Chancellor Merkel will find it even more difficult than today to persuade the German public to accept any additional European responsibilities. That is what creates a three-month window." Mr Soros predicted Greece would vote to stay in the euro this month. "I expect that the Greek public will be sufficiently frightened by the prospect of expulsion from the EU that it will give a narrow majority of seats to a coalition that is ready to abide by the current agreement."
He said he believed Germany would ultimately act to maintain the euro in some form in order to prevent "large unenforcable claims against the periphery countries".
- 1 The BBC has just done more to eradicate ‘terrorism’ than all our wars since 9/11
- 2 Dog thinks owner is drowning in lake, dives in and tries to pull him out
- 4 Chilling drone footage captures Auschwitz ahead of 70th anniversary of liberation
Auschwitz liberation 70th anniversary: Woman sent to three Nazi death camps describes surviving gas chamber
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Greece elections: Greek PM Alexis Tsipras takes aim at 'neo-liberal' Europe as country gears up for prolonged austerity battle
Pornhub star Mia Khalifa receives death threats after being ranked the site's top adult actress
Prince Philip set to be knighted by Australia: Celebrate by reading his greatest gaffes
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
30,000 reasons why the rhetoric on immigrants claiming benefits can stop now
£18000 - £20000 per annum: Recruitment Genius: To promote and sell the Company...
£30000 - £40000 per annum: Recruitment Genius: An exciting opportunity has ari...
£35000 per annum: Recruitment Genius: The Business: This company is going thro...
Negotiable: Tradewind Recruitment: Tradewind Recruitment are currently working...