The year 2008 proved to be one of the worst in history for the economy of the world especially the United States. The crash of the stock market left many investors holding what was their depleted accounts. In an economic forum in Sri Lanka yesterday, George Soros warned investors on Bloomberg to be very cautious because he detects similar characteristics emerging between the economy of today and that of 2008.
George Soros in an international investor who claims his hedge-fund firm progressively gained 20 percent every year from 1969 to 2011, and today he reports a net worth of over $27.3 billion. His career began in the 1950s in NYC, and his reputation was established on his incredible investing prowess. Soros has over 50 years of experience in the stock market, and he points out that a crisis may well be in the future by these eight identifiers.
Learn more about his profile at Forbes.com.
1. China has adjustment issues, and they had a $2.5 trillion loss that displayed serious challenges; China halted trade after the announcement. They have a devaluation of their currency, which is transmitting problems to the rest of the world. Soros replied that positive interest across the globe is a necessity.
2. The decreasing value of the yuan is affecting China’s economy, global currency, stocks and commodities since the beginning of 2016 because of the shift from investment to consumption and services.
3. Soros commented on the Greece-born European debt decline in 2011 saying that it was more serious than the crisis of 2008.
4. The Chicago Board Options Exchange Volatility Index or the VIX, affectionately known as a fear gauge, is up 13 percent.
5. The Nikkei Stock Average Volatility Index escalated to 43 percent this year. This index recognizes the cost of protection on Japanese shares, which involves the yuan
6. The Merrill Lynch Index of price alterations in Treasury bonds rose 5.7 percent.
7. Investment data reinforced a slow manufacturing sector.
8. The People’s Bank of China cut interest rates to record lows while the government authorities added billions of dollars to their weakened economy.
These indicators all point to global markets falling into a crisis very soon says George Soros. He reminds investors to be extremely cautious. Skyrocketing gold prices is another sign that the world’s economy is headed towards a crisis situation.