Soros predicts end of the road for cheap and easy borrowing

[ben_meyers]

The City of London faces a severe recession and the UK economy is set to follow the US into a sharp downturn, according to a gloomy prognosis from the billionaire financier George Soros.

Faced with over-valued houses, mountains of personal debt and a rise in unemployment, the UK is especially vulnerable to the effects of the credit crisis sweeping through financial markets, Mr Soros said, and he warned not to expect a rebound at any point in the near future.(snip)

"To say that it won't affect the real economy is untenable, because it affected it on the upside, so it will affect it on the downside. Recession in the US is inevitable. There will be implications for the globalised economy and the UK happens to be as vulnerable as the US, but in different ways. The finance industry is much more important to the UK because London is a financial centre and the industry is going through a painful process of deleveraging. The housing market in the UK has at least not seen the building boom that we have seen in the US and the supply of new homes has not gone up, but on the other hand, the indebtedness of UK households is actually even greater relative to income than in the US."(snip)

The views of a man who was born in Hungary and made his fortune in US hedge funds have always had a particular piquancy in the UK, where he is feted as the man who "broke the Bank of England". His heavy bets against sterling helped force it out of the European exchange rate mechanism in 1992, netting himself an estimated $1bn profit that Black Wednesday.

He deems the issue of sterling's value as too sensitive to discuss in interviews with British journalists these days, but in his new book, The New Paradigm for Financial Markets, he notes grimly that "the overvaluation of the euro and sterling is going to hurt European economies".

http://www.independent.co.uk/news/business/news/soros-predicts-end-of-the-road-for-cheap-and-easy-borrowing-804978.html

You can run, but you won't be able to hide. Don't worry about Soros, he'll make a few more Billions from all this.

[BlooInBloo]

1. Until the next time irresponsible lenders want to make a quick buck off irresponsible borrowers.

[DemoTex]

2. Irresponsible lenders/borrowers = Unregulated lenders/borrowers

De-regulation: Reaganites' wet dream.

[FogerRox]

3. Soros is a genius, brilliant

It took him this long to figure it out, gimme a freakin break.

[SoCalDem]

4. Globalization is not such a great idea

LOCALIZATION is the medicine wh must take to cure what ails us..

Stuff made/grown locally by people who live/work in the same communities..

It will mean no more $4.99lb Chilean grapes in January, and fewer $2 plastic flip-flops from China..BUT perhaps it's what e have been needing for a long time now.. Think of the fuel saved from NOT shipping boatloads of plastic shit across every ocean..

Credit MUST be eliminated as a "budget item".. People USED to shop without it, and we have to go back to that way.. Once we do that, prices/wages will re-adjust to a more rational level,,