George Soros on Bill Moyers Journal

October 10, 2008
George Soros

George Soros

This is, I think, the third week in a row that I have posted up video and text of an interview from Bill Moyers Journal, which airs Friday evenings on PBS. Click to watch tonight’s guest, George Soros, who spent 20 minutes dropping major bombshells about the state of the economy. As I write this, the program is still running, but here are some lowlights that have gotten my attention: “hopefully capitalism will survive”, “we are in a downward spiral”, “it’s the end of an era” and so on.

Soros clearly explains the reasons for the problem: Excessive credit expansion at two to three times the rate of the economy for the last 25 years and the sale of millions of mortgages as Wall Street securities, resulting in the warrantless skyrocketing of home values, and the credit that was given out based on those values, beyond all reason. Those securities generated a lot of wealth and fees along the way, but they were practically worthless as soon as they were sold. Unfortunately, they were sold and resold on markets around the world, gaining paper value at each stage, but they were still worthless. Bundling these mortgages, which was supposed to lower risk for all by spreading it around, actually resulted in much greater risk for everyone.

The whole system is in the midst of a massive correction. While Soros says that the recent reactions by Congress and the Treasury have so far been both too late and wrong, he believes there is still time (but not much) to take the right actions to stanch the bleeding. He suggests that banks will have to readjust mortgages to reflect real values and avoid massive foreclosures; that the government inject large amounts of capital into the markets to get things going again (before market dynamism is irretrievably lost); and that we revive the economy in the long term by refocusing the nation on rebuilding our infrastructure and developing new sources of renewable energy. (Remember global warming?)

This is going to one wild ride.


3 Responses to “George Soros on Bill Moyers Journal”

  1. inject some capital right here buddy Says:

    “Inject capital into the markets” is barely concealed code for “just give taxpayer money directly to investors, don’t even bother buying the silly products their companies make, just hand the money over as if to a panhandler on the corner.”

  2. masterpeace Says:

    Sounds about right.

  3. The Glenn Beck Review Says:

    You may appreciate a post I have up about Soros. It juxtaposes his background with Rupert Murdoch’s empire.

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