As Europe's crisis rages on, don't expect reassurance about the future of global capitalism from this Hungarian-born hedge fund billionaire and market guru. At a June speech in Italy, George Soros argued that the financial crisis represents a failure of economic theory "more profound than generally recognized" and decried the austerity-promoting policies of European governments, arguing that they "cannot reduce the debt burden by shrinking the economy."
Soros has been particularly withering in his assessment of German Chancellor Angela Merkel's (No. 12) response to the crisis. In a widely discussed New York Review of Books essay in September, he made the case that penny-wise, pound-foolish Germany, not Greece, is the country most at fault in the crisis. Germany must either lead Europe out of the crisis or leave the eurozone, he argued, which would limit the fallout of the crisis and allow smaller countries to return to growth with a devalued currency. Shortly thereafter, Merkel reversed course and supported the European Central Bank's plan to buy Spanish and Italian bonds -- so perhaps Berlin was listening.
Soros, often the object of conspiracy theories for his support for liberal groups in the United States, dialed it back a little this election year -- even going so far as to say that there "isn't all that much difference" between President Barack Obama and contender Mitt Romney. An investor as shrewd as Soros knows it's always wise to hedge.