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This is what Soros himself said in an interview in New York Times, in 1992: "Our total position by Black Wednesday had to be worth almost $10 billion. We plann

by zosima 4y ago

This is what Soros himself said in an interview in New York Times, in 1992: "Our total position by Black Wednesday had to be worth almost $10 billion. We planned to sell more than that. In fact, when Norman Lamont said just before the devaluation that he would borrow nearly $15 billion to defend sterling, we were amused because that was about how much we wanted to sell." It seems to prove both collusion and that $10 billion was a lot of money for pound sterling at the time.

bionsystem 4y ago
So I don't get from this quote, neither who colluded with Soros or how it proves collusion, nor why 10 or 15 billions would be a lot. Daily volume of GBP was 161 billions in 2001 (source is statista).
- zosima 4y ago
  British GDP in 1992 was $1.2 trillion. $10 billion was therefore roughly 1% of GDP. That's a damn lot of money for a government and likely way more than daily volume of traded GBP (or GBP used in trade, on an average day). I think the fact he seems to suggest that "we" were trading more than their position ($15 billion vs. $10 billion) does suggest that there was another company or financier involved. May be my misreading, but then again, I don't believe that there is any real controversy in that this was discussed and coordinated between several trading firms.
  - bionsystem 4y ago
    I think that there are a few misconceptions here. Money supply isn't GDP (although there are relationships but that's beyond the scope of this discussion). The government isn't the central bank. And the UK was facing a recession making the peg really hard to maintain, that's about it. I think Soros in this quote was "mocking" the 15 B part for how pathetic their effort was. You can't save (or destroy) a currency with that kind of money. I don't see any evidence of a coordination although it's clear that some other people were involved, just like a bunch of people took advantage of the GFC, or of oil going negative in 2020, but that doesn't mean those people were involved in provoking it or "coordinating". You have to understand that hedge funds compete against each other, we've seen that many times in history.
    - zosima 4y ago
      The currency was pegged to ECU and so government + central bank was purchasing pounds to maintain the exchange rate (the central bank was not free from government influence at the time.) To do that, they borrowed $15 billion to a war chest, which at the time was > 1% of UK GDP. It was not enough to maintain the exchange rate and one of the reasons for that was the gigantic short-sale of pounds by Soros and friends.

by zosima 4y ago

bionsystem 4y ago

So I don't get from this quote, neither who colluded with Soros or how it proves collusion, nor why 10 or 15 billions would be a lot. Daily volume of GBP was 161 billions in 2001 (source is statista).

zosima 4y ago
British GDP in 1992 was $1.2 trillion. $10 billion was therefore roughly 1% of GDP. That's a damn lot of money for a government and likely way more than daily volume of traded GBP (or GBP used in trade, on an average day). I think the fact he seems to suggest that "we" were trading more than their position ($15 billion vs. $10 billion) does suggest that there was another company or financier involved. May be my misreading, but then again, I don't believe that there is any real controversy in that this was discussed and coordinated between several trading firms.
- bionsystem 4y ago
  I think that there are a few misconceptions here. Money supply isn't GDP (although there are relationships but that's beyond the scope of this discussion). The government isn't the central bank. And the UK was facing a recession making the peg really hard to maintain, that's about it. I think Soros in this quote was "mocking" the 15 B part for how pathetic their effort was. You can't save (or destroy) a currency with that kind of money. I don't see any evidence of a coordination although it's clear that some other people were involved, just like a bunch of people took advantage of the GFC, or of oil going negative in 2020, but that doesn't mean those people were involved in provoking it or "coordinating". You have to understand that hedge funds compete against each other, we've seen that many times in history.
  - zosima 4y ago
    The currency was pegged to ECU and so government + central bank was purchasing pounds to maintain the exchange rate (the central bank was not free from government influence at the time.) To do that, they borrowed $15 billion to a war chest, which at the time was > 1% of UK GDP. It was not enough to maintain the exchange rate and one of the reasons for that was the gigantic short-sale of pounds by Soros and friends.