If you’re one of the people who hopes that the economy is finally making a turn for the better, you may want to think again. Billionaire George Soros sees a storm brewing that could spell disaster for any chances of financial recovery.
During an economic forum for Bloomberg.com that was held in Sri Lanka in January 2016, Soros predicted that the global economy is on track for a crash reminiscent of the one that occurred in 2008. He attributes much of this to the devaluation that is occurring with Chinese currency, the yuan. Due to changes in the major exports of China, which once were industrial and manufacturing, but have since become primarily consumption and services, Chinese currency is becoming less valuable than it once was, and this is having an effect on the global economy as a whole.
Soros, who is essentially a self-made billionaire, is no stranger to the global marketplace. He amassed his fortune through an international investment fund that he both founded and managed. This means that he’s spent his career keeping an eye on the pulse of what’s happening in the global economic community, so he isn’t speaking without a measure of knowledge concerning what keeps the economy afloat.
On a personal level, if there’s one thing that you should take away from this article, is the importance of production. Chinese currency was more valuable when they had a solid hold on the manufacturing industry. As their levels of consumption increased, their dollar lost value accordingly. This is an important point to keep in mind.
As much as you can, make it your aim to produce more than you consume. This may be a key way for you to preserve your own value so that you can provide for yourself in case Soros turns out to be correct.