While George Soros today said that he believed the worst consequences to the financial system are past, he was far from bullish about the economy. The veteran investor believes that the real world impact is only beginning to be felt.
Given that the last housing recession of the late 1980s-early 1990s took 15 quarters to reach bottom, Soros’s forecast is consistent with historical patterns.
Billionaire investor George Soros said the “acute phase” of the financial crisis is “largely behind us” even as the U.S. economy is only now starting to feel the effect.
The damage done to the global financial system “has to affect, in my opinion, the real economy,” Soros, 77, said in a question-and-answer session in Washington today. “The effect of that is only beginning to be felt. There is a certain time lag.”
Just as housing prices “overshot on the upside,” they will overshoot on the way down, Soros said. The U.S. is in the “very beginning of an uptrend” in foreclosures, he said at an event hosted by the Council on Foreign Relations…
Sovereign wealth funds have been a “positive factor” in stabilizing U.S. financial companies, Soros said. Certain “standards” need to be set for the funds because they could come under political influence, he said….
U.S. stocks are in “a bear-market rally,” Soros said. The Dow Jones Industrial Average has risen 10 percent since March 10…
Soros earned an estimated $2.9 billion last year, ranking second after John Paulson, founder of New York-based Paulson & Co., according to Institutional Investor’s Alpha Magazine.