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QE Reaches Limit; Fall Will Be Harder

johnm h Wrote: Nov 10, 2012 9:38 AM
When Soros invests in shaky economies, he invests borrowed funds, then he pays back his loans with devalued currency. This means he would have to invest funds borrowed in Greece but those are also Euros. To know what he is up to we must know what funds he is investing. Is he targeting the Euro or the dollar? or is he picking up real assets because he thinks Greece will survive as part of the Euro?
Greg1084 Wrote: Nov 10, 2012 9:58 AM
He may just be purchasing assets at bargain basement prices planning to sell when things settle out. The thing that puzzles me is that I don't think Greece has really hit bottom. Maybe he thinks it has. He probably has inside information on what is going to happen next.
johnm h Wrote: Nov 10, 2012 10:08 AM
If he's investing his own money probably so on both, bargain prices and inside information. My view has been that we don't face a fiscal cliff and rapid devaluation of the dollar for years, but if Soros is borrowing dollars he may see a more rapid decline of the dollar. He has certainly been working for it.

Via email, the chief economist for Saxo Bank in Denmark, Steen Jakobsen, discusses the "Saturation Point" for QE and the "Fiscal Cliff" in the US.

Steen writes ...


Fiscal Cliff Comparisons

  • A lot of people are starting to compare 2012 with 1987. Yes, it's scary.
  • Other people compare the fiscal cliff to 1937 Roosevelt where stock market tanked 50%.
  • Few people seems to realize that part of the "fiscal cliff" involved higher taxes on financial transactions, meaning...