George Soros is a billionaire who has been right time and time again regarding the current and future conditions of global capital markets. He made billions according to Fortune magazine making the right bets against currency fluctuations as well as smart investing in capital markets. His opinion is very well respected in financial and political circles. Currently he is of the opinion that our current financial status is very reminiscent of the time before the global financial crisis we faced in 2008. His opinion is taken very highly among traders on the street as well as the financial press.
The first thing that you need to know about George Soros is that he has a net works of upwards of 20 billion dollars. His hedge fund, Soros Fund Management has averaged returns of roughly 20 percent over the past 10 years which is an incredible return over time. His opinion is so valued by the global markets that after he made statements predicting hard times for the Russian economy he was actually banned from the country, according to Fortune Magazine, which is a very well respect financial paper. < a href = http://fortune.com/2015/11/30/russia-bans-george-soros-foundation-as-state-security-threat/ > Fortune Magazine < / a >
While many financial advisers and wealth creators predict doom for the markets on a daily basis very few of them have reputation and respect that George Soros commands. This is why many involved in financial markets are so worried that he is predicting hard times ahead for markets. His prediction starts with the Chinese market. For the past 10 years Chinese industry has been one of the drivers of global growth. Chinese industry purchases a massive amount of commodities that it turns into finish products that are exported all over the globe. The decrease in Chinese manufacturing is very likely to have a cascading effect on markets worldwide as commodities producers are unable to sell their resources.
This means that less goods are being consumed and produced which leads to a total global slowdown. Decreased demand means decreased commerce activity which can be terrible for markets as a whole. The Chinese stock market is also crumbling- they actually had to close the markets 3 times recently because trading was going so poorly. This is not a good sign. The global volatility index is also going out of control with no rhyme or reason. This affects everything from currency values to manufacturing output.
These commodity issues affect more than the Chinese domestic markets. Stock exchanges across the global are feeling the burn and over the past month aggregate global stock exchanges have been down more than 14$ and show no signs of abating. While nothing is certain in financial markets decreased consumption always leads to decreased production which means to loss of jobs. This creates a spiral effect that means consumers have less money to spend which decreases demand even more. Now nothing in financial markets is set in stone but all of these indicators have led George Soros to believe that we are in a repeat for the troubles that markets faced in 2008.