Soros: Brexit has "unleashed" a financial crisis
Famed US investor warns that there may he huge global consequences after Leave victory
- George Soros rose to fame as the money manager who won billions of dollars against the Bank of England in 1992
- Investor was one of many critics of Brexit before the referendum which passed 52%-48%
George Soros said on Thursday that Britain's decision to leave the European Union could have disastrous consequences after it has "unleashed" a crisis in financial markets, similar to to that of 2008.
The famed US investor rose to prominence in 1992 after breaking the Bank of England, making over $1 billion as he bet against the value of the pound.
Speaking to the European Parliament in Brussels on Thursday, Soros was not optimistic about the near future.
“This has been unfolding in slow motion, but Brexit will accelerate it. It is likely to reinforce the deflationary trends that were already prevalent,” the billionaire investor said.
“We know what needs to be done. Unfortunately, political and ideological disagreements within the euro zone have stood in the way” of using the European Stability Mechanism as a backstop, he said.
"This has been unfolding in slow motion, but Brexit will accelerate it" George Soros
Before last Thursday's historic vote on the UK's relationship with the EU, Soros had stood with other economic experts that said that a Brexit would bring on a lot of major problems in the British and the European economy in general.
The decision meant “the hypothetical became very real,” Soros said. “Sterling plunged, Scotland threatened to break away, and some of the working people who supported the ‘Leave’ campaign have started to realize the bleak future that both the country and they personally face. Even the champions of Leave are retracting their dishonest pre-referendum claims about Brexit.”
Since the onset of the global crisis in 2008, the Eurozone has not recovered as much as other areas, and for Soros this is down to "restrictive fiscal policies".
“The orthodoxy of German policy makers stands in the way of the only effective response: having a euro-zone budget that could adopt counter-cyclical policies," Soros said.
