George Soros: Great Britain May Require Financial Rescue
The British must feel a little bit like the late American comedian Rodney Dangerfield these days. Dangerfield, you might remember, immortalized the phrase, “I don’t get no respect.”
Back on January 20, legendary investor Jim Rogers spoke to Bloomberg’s Paul Gordon about the outlook for the U.K. economy and the pound, and said:
For the last 26 years, the U.K. has been selling oil, the North Sea. That’s what’s saved the U.K. in the past three decades. It’s finished. The North Sea oil is running out. Within the decade, the U.K. will be importing oil again. And then they’ve got nothing to sell… I mean, again, I hate to say it, but I would not put any money in the U.K. I’ve sold all of my sterling…
Now, Rogers’ partner in the Quantum Fund, billionaire hedge fund manager George Soros, is warning that the United Kingdom may need a financial rescue. Rachel Sylvester, Alice Thomson, and Philip Webster wrote in The Times (UK) this past Saturday:
Britain may have to go to the IMF for a huge financial bailout, the influential investor George Soros warns today.
The man who made $1 billion on Black Wednesday in 1992 told The Times that Britain was particularly vulnerable to the economic crisis.
Mr Soros – speaking days after an auction of government bonds failed for the first time in 14 years, ringing alarm bells about Britain’s ability to fund its growing debts – said that Gordon Brown might have to go begging for billions of pounds in international aid. He also warned that next week’s G20 summit in London was the last chance to avert a full-scale depression that could prove worse than that in the 1930s.
“You have a problem that the banking system is bigger than the economy . . . so for Britain to absorb it alone would really pile up the debt,” he said. Asked about the chances of Britain having to seek help from the International Monetary Fund, he said that if the banking system continued to collapse, it was “a possibility”. At this stage, he added, it was “not a likelihood”.
He was not optimistic about the G20 meeting, saying the odds were that it would fail because there were so many differences of opinion. The price could be years of economic devastation worse than the Great Depression. “It is really a make-or-break occasion.”
Source:
“George Soros: Britain may have to seek IMF rescue”
Rachel Sylvester, Alice Thomson, and Philip Webster
The Times (UK), March 28, 2009
