World-renowned financial guru George Soros expressed extreme pessimism about the immediate future for Europe and the eurozone during a talk to mark the official opening of the University of Copenhagen’s Institute for New Economic Thinking (INET), Monday, a Copenhagen wing of the New York City-based nonprofit think-tank he helped to found in October 2009.
The self-made billionaire philanthropist, known as the ‘Man Who Broke the Bank of England’ when he made millions by speculating against the British pound in the 1990’s, and who was a pre-crisis, lone voice in 2008 when he predicted that a ‘superbubble’ had built up over the past 25 years and was ready to collapse, warned of the real possibility of a euro break-up, according to the University Post.
“Right now, the highly indebted countries inside the eurozone find themselves in the position of a Third World country,” he said. “They have debt in a foreign currency, yet can’t print their own. I can see the EU facing a lost decade, similar to what happened in Latin America after the debt crisis in the 1980’s. Or even worse, it could be like Japan and stagnate for more than 25 years.”
Mr Soros also accused Europan leaders of ‘not being up to the task’ and said the authorities, by failing to understand the full extent of the problem, have prescribed the wrong medicine. He described German Chancellor Angela Merkel as a ‘strong leader’ but heading in the wrong direction.
The Institute for New Economic Thinking INET, seen as a forum for new and innovative thinking on current economic challenges, has been financed by Mr Soros and fellow businessman and philanthropist Jim Balsillie, ranked by Forbes as the 692th wealthiest in the world with a net worth of USD 800m.