June 5, 2012

It has been a while since we checked up on the would-be Ruler of the New World Order. We do so today since he has made a splash recently with his warning in a speech at the Festival of Economics in Trento, Italy.

George Soros has pronounced that the Euro-zone governments have around three months to ensure the survival of the single currency. If his past record is considered, Greece, Italy, Spain, Ireland, Portugal and especially Germany had better heed his warning.

Here is the Emperor's plan: Soros says the euro zone needs a European deposit insurance scheme for banks as well as direct financing by the European Stability Mechanism (ESM) for banks, which “must go hand-in-hand with euro-zone-wide supervision and regulation.”

Translation: All this talk of austerity is absurd.

Soros wants all of Europe, indeed the entire world, to believe that there is just a three-month window during which they could still correct their mistakes and reverse the current trends [of requiring austerity]. By the authorities I mean mainly the German government and the Bundesbank because in a crisis the creditors are in the driver’s seat and nothing can be done without German support.

What this means is that Soros has either got a long or short position in some currency, or commodity, or other investment.

And he plans on making a bundle. But he can't do it if austerity measures are put in place.

John Ransom at Townhall Finance says Soros is "a vampire when it comes to currency crises. And in Europe, as he has elsewhere, he’s looking for blood."

Consider, again, Soros's past: He broke the Bank of England with $10 billion in 1992. In 1997 he was implicated in the currency crisis in Thailand, which eventually moved to the U.S. stock markets, which crashed in October of that year.

He was convicted of insider trading in France and in 2003, according to Dan Gainor at the Media Research Center, Russian authorities raided Soros’ offices in Moscow, essentially driving him and his fund out of the country. He’s long been suspected of manipulating Russian currency and creating the crisis that saw the rise of Putin in Russia.

In short- pun intended- wherever there is financial pain around the world, expect Soros to show up and make himself money- and hated too.    

Kenshi Taketa, an economist who specializes in currency crisis says that “large speculators, like George Soros or Julian Robertson, have not only been blamed for destabilizing the market unnecessarily during the turmoil of contagious currency crises, but also for triggering these contagious crises by themselves. For instance, during the turmoil of the Asian Flu [in 1997], the then Malaysian prime minister, Mahathir Mohamad, accused George Soros and others of being ‘the anarchists, self-serving rogues and international brigandage.’”

Taketa argues that large currency speculators, such as Soros, help spread financial contagion by creating a feeding frenzy amongst smaller speculators.

“Two main conclusions are derived,” writes Takea. “First, financial disclosure of speculators eliminates contagion, but may make countries more vulnerable to crises. Second, regulating the size of speculators (e.g., prohibiting hedge funds from high-leverage) makes countries less vulnerable to crises, but makes contagion more severe.”

That’s why we need to implement new rules- the Soros Rules- that require large, systemic speculators, which can cause the collapse of financial institutions and countries- like Soros can- to fully disclose their purchases and sales in the same way that we require insiders to report inside trading.

In addition we need to limit their ability to use leverage thereby limiting their ability to attack countries and destabilize their currencies by sheer volume alone.

We already require systemic financial services companies to limit risk so as to limit the danger to the nation’s financial system.

Why would we allow one bad actor to get away with actions we allow no one else?  

Even far-left economist Paul Krugman agrees: "[N]obody who has read a business magazine in the last few years,” writes Krugman in The Accidental Theorist: and Other Dispatches from the Dismal Science, “can be unaware that these days there really are investors who not only move money in anticipation of a currency crisis, but actually do their best to trigger that crisis for fun and profit. These new actors on the scene do not yet have a standard name; my proposed term is 'Soroi.’”

When Obama and company get up on their soapbox and demand draconian regulatory schemes to fence in the financial industry, how can they ignore the folks, like Soros, who apparently create mayhem on purpose? After all, at least until recently Obama answered to Soros.

Obama and Soros want us to believe they protect us from the stupidity of banks, but this comes at great cost to the banking system, but allow the predations of the speculator done with intent to harm, at great cost to the rest of us.   

After spending literally trillions in taxpayer money in bailing out our financial system, should we put it all at risk just because a speculator writes big checks to progressive causes?   

Don’t get me wrong: I believe in free markets. But in a free society we also have the right to self-defense.

We believe that the Constitution of the United States speaks for itself. There is no need to rewrite, change or reinterpret it to suit the fancies of special interest groups or protected classes.