George Soros is one of the most respected names in the world of global finance. The billionaire investor often talks about the state of the markets and how he believes they will move in the future. At a recent economic forum held in Colombo, Sri Lanka, Soros has advised investors to proceed with extreme caution. Bloomberg has reported on what he told attendees.
Soros has talked on Bloomberg at length about China and how its economic performance is affecting not only other Asian countries, but also the entire world. He believes that China is having trouble finding ways to grow its economy and the devaluation of its currency is having an effect on other markets around the world. He also added that he sees many similarities between the current economic climate and what took place in 2008.
During the first week of 2016, world markets have performed quite poorly as a dropping Chinese yuan has caused a lot of concern among investors. While China has the second-largest economy in the world, there are doubts as to whether the country can do enough to grow it. The Chinese economy is now starting to move to consumption and services, which signals a change from having an economy that relied heavily on manufacturing and investment.
China is well aware of its economic situation and has taken action to try and remedy its problems. So far, the People’s Bank of China has significantly cut down interest rates and local authorities are working hard to put hundreds of billions of dollars into the economy. In the longer term, the Chinese government is pledging to increase the convertibility of its currency by the year 2020 and to progressively get rid of capital controls.
Whether China will be able to get its economy back on track remains to be seen. In the meantime, Soros is urging investors to play close attention to the markets and to make careful choices.
According to the official George Soros information website, the wealthy financier was born in Budapest, Hungary in 1930. He has faced many challenges in his early years, including surviving Nazi occupation and having to flee his country in 1947 when a communist government took over. He traveled to England, where he studied at the London School of Economics, before moving to the United States. This is where he started Soros Fund Management, one of the most successful investment funds of all times. He has since donated billions of dollars to various charitable causes and regularly speaks his mind on issues related to economics, politics and society.