Wednesday, July 1, 2009

Soros Predicts ‘Stop-Go’ Economy And Higher Rates

Billionaire investor George Soros on Tuesday predicted a “stop-go” economy for the United States, saying fears of inflation will drive up interest rates and choke off growth, Reuters reported.

“As markets revive, fear of inflation will drive up interest rates, which will choke off recovery,” he said.


“The idea of self-correcting markets is a misconception,” he said. What governments need to do, he said, is recognize they cannot prevent bubbles but instead try to control them from getting bigger.

“You cannot prevent bubbles from forming but prevent them from self-reinforcement,” Mr. Soros said.

Mr. Soros, who has retired from active fund management, acknowledged that getting regulation right is not easy as he argued both for and against stricter supervision.

“The regulators will always be wrong,” he said. “They should interfere as little as possible.”

Soros Story | Source