On Saturday, famed hedge fund billionaire and economic theorist George Soros gave a speech in Trento, Italy before the Festival of Economics about the European financial crisis. It's quite long, but still well worth reading because his understanding of Europe's problems is clear and deep. You can find it on his site GeorgeSoros.com.
Some of the controversial headlines that have been drawn out in Reuters and elsewhere are that Germany and its central bank are unlikely to lead the way out of the euro zone debt crisis within three months time, after which it will be too late and thus they threatened to destroy the European Union and plunge it into a lost decade like Latin America in the 1980s.
"The Greek crisis is liable to come to a climax in the fall. By that time the German economy will also be weakening so that Chancellor Merkel will find it even more difficult than today to persuade the German public to accept any additional European responsibilities. That is what creates a three-month window," Soros said.
The Hungarian-born U.S. financier said that all the "blame and burden" of adjusting the euro area's imbalances was falling on weaker peripheral countries, but the bloc's core bore an ever greater responsibility for the crisis.
"The 'centre' is responsible for designing a flawed system, enacting flawed treaties, pursuing flawed policies and always doing too little too late," he said.