In early January, George Soros spoke to Bloomberg and a Sri Lanka economic forum. He believes that the Global market looks like it did back in 2008. Soros cautions investors to be careful during this financial crisis. China’s currency devaluation is creating problems for the rest of the world. The Asian country is seeking a new growth model. The weakening yuan has cost the market $2.5 trillion. China is temporarily shifting their focus from investing to consumer consumption services. China is the world’s second largest economy in the Global market. As a result, the only way to salvage the Global market is when China’s economy heals. Because of China’s crisis, the value of the world markets have fallen and oil prices plummeted.
Before the hedge-fund billionaire started his hedge-fund firm in 1969, Soros had more than a decade’s worth of investment experience. He started in New York, back in the 1950s. His investment prowess came about when he made in 1992.
Australian Academic and Board Director, Paul Mazzola agrees that China’s financial great economy crisis is definitely creating a ripple effect throughout the world. He does not think it will cause a financial crisis throughout the globe.
According to financial experts, the global crisis of 2008 was the worst since the depression of the 1930s. In 2007, home prices began to tumble, creating a domino effect throughout the United States financial sector and then spreading out to economies overseas. The crisis originated in the United States because mortgage lenders offered low interest deals to families who did not qualify and were not able to pay back the loan. These loans were sold to banks as Fanny Maes and Freddie Macs. These were wrongly called low-risk investments. After that, the insurance companies started trading what’s called credit default swaps. To sum it up, this crisis went from the entire United States investment banking agencies, the largest insurance companies, and the biggest mortgage lenders to overseas. The auto industry had to request a federal bailout. Banks stopped making loans because they believed they couldn’t be paid back. By December 2008, Germany, Japan, and China were in a global recession. It was dubbed the third longest recession in the world since we were involved in World War II.
In 2009, congress passed the American Recovery and Reinvestment Act of 2009. In the summer of 2010, the Dodd–Frank regulatory reforms went into effect to prevent such a crisis as the 2008 financial crisis from happening again in the United States.
China is broadening its efforts to off-set their economy slowing by revising some financial rules and creating marketing interventions in much the same way the United States did eight years ago.