• Germany's news in English

Soros: German austerity could spark currency war

The Local · 25 Jan 2013, 14:41

Published: 25 Jan 2013 14:41 GMT+01:00

Speaking Thursday evening at the World Economic Forum in Davos, Switzerland, the billionaire renewed his criticism of Berlin's focus on restrictive fiscal and monetary policy to solve Europe's sovereign debt crisis.

"The rest of the world follows a different recipe from the Germans. Germans believe in austerity, and the rest of the world believes in quantitative easing," Soros said in an interview, according to news agency Reuters. "I think the biggest danger is actually, potentially, a currency war."

Hungarian-born Soros is famous for making $1 billion in 1992 by betting against the British pound on global currency markets.

Despite his criticism of Germany's handling of the euro crisis, Soros said the immediate threat to Europe's single currency appeared to be receding.

Soros said Germany would always do "the minimum" to ensure the euro's survival, Bloomberg News reported. And as other countries pursued looser monetary policies than the European Central Bank, Europe's currency was bound to strengthen in the coming months.

“I generally don’t know how far things go but I can see which way they are going,” he said. The trend is for the “euro to rise and the yen to fall.”

Story continues below…

The Local/mry

The Local (news@thelocal.de)

Your comments about this article

15:24 January 25, 2013 by Berlin fuer alles
Well austerity imposed on other Eurozone countries has worked for Germany so far so why not keep going? After all if you keep beating a half dead donkey he will continue to move forward a little with no effort needed from the whipmaster.
15:49 January 25, 2013 by TheCrownPrince
Shut up, Soros. I bet you have lost a lot of money because Germany refused to throw money around like mad. Austerity and thriftiness did not do much good for your little bets, did they, Soros? Old fool. If Soros is barking you can bet your are on the right path.
16:01 January 25, 2013 by Berlin fuer alles
You are of course correct @TheCrownPrince. However in light of failing economies of Germany's Euro partners one could view Soros's words as carrying weight too as it is clear the current remedy of austerity is only making things worse throughout the Eurozone and Germany is now getting pulled down too.
16:31 January 25, 2013 by SchwabHallRocks
Soros is only repeating what essentially all the other governments in the world, sans Germany, are doing: increasing the money supply, increasing government consumption to buffer the effects of the recession.

(Yes, we all know that we are borrowing now and screwing over the next generation.)

However, do I actually detect a whiff of bias against Soros because....???
17:26 January 25, 2013 by smart2012
If Germany would have listened to Soros 2 years ago, now it's economy would not be struggling. And many if my colleagues would not have lost their job..
17:53 January 25, 2013 by Tonne
"The trend is for the ¦quot;euro to rise and the yen to fall.¦quot;"

For Soros that is not a prediction but an intent.
18:16 January 25, 2013 by IchBinKönig
'If Germany would have listened to Soros 2 years ago, now it's economy would not be struggling.'

Exactly as is the case in the United States. The National Debt has not been more than doubles in 4 Years, and the Economy is not Struggling.
21:26 January 25, 2013 by jg.
The Soros recipe for success would be to print money and spend it like water - as Greece, Spain, Italy and others used to do, before they joined the Euro and lost the right to print money. Funnily enough, everyone joined the Euro precisely because they wanted an economy like Germany, a currency like the DM and interest rates to match. Those qualities were all earned though strict fiscal policy on the part of Germany.

Currency speculators like Soros make more money from volatile markets, where they can take advantage of fluctuating exchange rates. Stability is abhorrent to them.

In any case, I cannot see Germans ignoring their own history and attempting growth on the back of a mountain of debt and printed money. The USA has been getting away with this as the Chinese have been willing to prop up the dollar to maintain their exports - but it is a dangerous game (just ask the Argentinians).
22:13 January 25, 2013 by US-TommyBoy
Currency war? I thought y'all just used the Euro?

Ignore the talking head Soros. If Germany is to prosper, it must go it's own way.

None of the rest of the Euro trash has the will, the want, the need and the leadership to look a coming crisis in the eye and prepare for it.

In fact, if Germany does not continue to do exactly what Soros does not want you to do, you will be dragged down with the rest of the Euro Trash.

The question is, what is Soros invested in that whatever the Germans do is causing him heartburn?
13:33 January 26, 2013 by zeddriver

Soros is no fool nor is he stupid. Evil and manipulating yes. One doesn't become a billionaire by being a misguided fool. As others have stated now and in the past. He makes his money by creating doubt and uncertainty. He has so much money in the market. That he can change the market by saying such things. So. He puts money in a certain area. THEN he starts a conversation to move the market in a direction that will benefit HIM. He's like criminal character Auric Goldfinger in the James Bond film "Goldfinger".
18:20 January 26, 2013 by Enough
Soros is a bastard that does everything he can to manipulate situations to his benifet. I would not believe a thing he says nor would I trust him with anything. The world will be much better off the day he croakes!
21:15 January 26, 2013 by GustavSwe
He have been critical and accusing Germany from the beginning of this financial cris. I don't have any respect of that man because doing so.
00:09 January 27, 2013 by smart2012
Guys, before judging Soros please judge weideman and Verkel. They want to avoid inflation to keep the euro strong, but now they r criticizing Japan cause they print money and euro would become too strong. What the hell to they want those guys, strong, not strong or? Soros is right, Germany is killing Europe and its own business. Glad that q4 2012 GDP of super Germany will be -0,5%
12:04 January 27, 2013 by zeddriver

Of course we can judge Soros. Based on his past actions. He will invest in currency A. Then start bad mouthing currency B. Currency B starts to drop. Then currency A goes up. He sells currency A for big profit. Then turns and buys currency B which he had a hand in deflating. Then starts it all over again by now bad mouthing currency A.

I would have no issues with a savvy investor. I do have an issue with a guy that has enough power/money to influence the market in what ever direction he wants.

Soros has absolutely no sympathy nor cares one wit about the nations or the people within. He cares only about his next billion. And all the while. He invests heavily into the left wing socialist agenda. Which preaches hate to any form of free market capitalism. Which is really odd. Because he got rich from said capitalism that he seems to be against.
17:14 January 27, 2013 by Eastard
On a side note... does anyone else think Soros looks like the Emperor on Star Wars after his change to the demon...?

Soros is good at making money without adding value... That is why he wants Socialism... he knows how to use it... I would say that he is not giving away any tips on economic management unless they would help his money quest... If you look around the world he funds anything that can be used to manipulate (to his interest) the people of different countries... Listen to him... do not use his direction or guidance... he has a history of intervention to his profit...
22:52 January 27, 2013 by zene
From what i know about Soros, he is a smart and respected guy in his field. And those who claim that he manipulates the market by making such statements are being naive. We are a couple of centuries ahead of the time when this was possible. May be if he "publicly" donated a percent or two from his wealth, people would be less envious and have a positive opinion of him.
15:50 January 28, 2013 by smart2012
U did not answer me on Japan case.... Do u then agree with me?
Today's headlines
Germany to send 1,200 troops to aid ISIS fight
Berlin has offered France Tornado reconnaissance jets. Photo: Luftwaffe

Germany to send 1,200 troops to aid ISIS fight

8 minutes ago

Germany is planning to deploy 1,200 troops to help France in the fight against Islamic State jihadists in Syria, its army chief said Sunday, in what would be the military's biggest deployment abroad.

Refugee spending revs up German growth
Germany will spend €10bn on housing, feeding and processing the more than 800,000 people coming to the country this year. Photo: Patrick Pleul/dpa

Refugee spending revs up German growth

3 hours ago

A massive influx of refugees, and accompanying billions in public spending, have provided Germany with a long-awaited answer to partners' calls for it to do more to jumpstart the eurozone economy.

Lufthansa inks pay deal with 30,000 ground staff
Lufthansa has yet to strike a deal with the UFO flight attendant's union. Photo: Boris Roessler/dpa

Lufthansa inks pay deal with 30,000 ground staff

3 hours ago

German carrier Lufthansa, reeling under a series of recent strikes, said on Saturday that it had reached a wage rise accord with services sector union Verdi covering 30,000 ground staff.

Paris climate conference
Germans reluctant to go green, survey finds
This NASA handout shows CO2 release based on real emissions data. Photo: DPA

Germans reluctant to go green, survey finds

1 day ago

Most Germans might see climate change as a threat - but that doesn't mean they're willing to change their behaviour, according to a recent YouGov survey.

The Local List
The 10 greatest German Alpine ski resorts
Skiing in the Allgäu. Photo: DPA

The 10 greatest German Alpine ski resorts

1 day ago

This ski season looks set to be epic, with runs already open before December has even started - boding well for the rest of the season. We bring you the ten very best German resorts so you can make the most of it.

Bavaria accused of hoarding Nazi-looted art
Max Beckmann paintings in the Pinakothek der Moderne in Munich. File Photo: DPA

Bavaria accused of hoarding Nazi-looted art

2 days ago

A group of US Congressmen have sent a letter to Bavarian Minister President Horst Seehofer, urging him to do more to help return art stolen by the Nazis to its rightful owners.

Berlin suspects freed hours after terror raids
Police stand guard as colleagues search a van in Britz, south Berlin, on Thursday evening. Photo: DPA

Berlin suspects freed hours after terror raids

2 days ago

Three suspects arrested in Berlin on Thursday night on suspicion of planning a terrorist attack were freed on Friday morning, police said.

Cologne fights drunks with walls that 'pee back'
"Don't pee here! The wall pees back!" warns a new sign in Cologne main station. Photo: DPA

Cologne fights drunks with walls that 'pee back'

2 days ago

In Germany, those who urinate in public places have their own name: "Wildpinkler" or "free pee-ers." But they're about to face a backlash in Cologne - in a very literal and embarrassing way.

Final days of Hamburg Olympic vote battle
Demonstrators against the Olympic bid. Photo: DPA

Final days of Hamburg Olympic vote battle

2 days ago

The finishing line is in sight. On Sunday Hamburgers vote on whether they want the 2022 Olympics to come to town and the result could be tight.

Two men arrested in Berlin police terror raids
A Berlin SEK (SWAT) officer during a deployment in June 2015. Photo: DPA

Two men arrested in Berlin police terror raids

2 days ago

Police arrested two men after raids at two Berlin locations on Thursday afternoon after tip-offs about known Islamists believed to pose a threat of violence.

Germany's 10 most-expensive cities
Sponsored Article
How to figure out healthcare abroad
German ISS astronaut tells kids to follow their dreams
Sponsored Article
Why family companies need free trade and TTIP
90 percent of Germans want tougher security
Sponsored Article
'Innovative companies like Hövding benefit most from TTIP'
Are you living in Germany's most expensive city?
Sponsored Article
The cheapest and fastest way to transfer money
Should singer accused of homophobia represent Germany at Eurovision?
70 years since the Nuremberg Trials
The German connection in the Paris attacks
Snow expected on 'first weekend of winter'
10 years of Angela Merkel in Berlin
Could soldiers soon be patrolling German streets?
Second German Paris victim was teacher and journalist
'We can't beat Isis with military means'
How will Germany help France fight Isis?
One German confirmed dead in Paris attacks
'Don't take Paris out on refugees': German defence minister
Germany's minute of silence for Paris victims
Nightclub bans refugees for harassing women
OPINION: Refugees must learn to respect German values
The ancient German community at the heart of Texas
jobs available
Toytown Germany
Germany's English-speaking crowd