The decision by the European Central Bank to begin €1.14 trillion quantitative easing (QE) program will eventually reinforce inequality within Europe and have serious political consequences, billionaire George Soros told RT in Davos.
“Excessive reliance on monetary policy and attempts to enrich the owners of property will not relieve the downward pressure on wages,” said Soros to a question from RT during a news conference in Davos. He says it’s too early to react to QE measures in Europe, but they will clearly deepen the crisis of trust between the rich and the poor.
The European Central Bank announced Thursday a €1.14 trillion ($1.3 trillion) quantitative easing program from March. The bank will buy government debt by monthly injecting €60 billion in public and private securities. The move is expected to drive inflation to the target of 2 percent and overcome a triple-dip recession in the eurozone.
The anti-poverty charity Oxfam released a report ahead of the Davos meeting this week, warning of the unprecedented economic inequality splitting the world apart.
According to Oxfam, the richest one per cent will own more than half of the world’s wealth by 2016. Their share is growing extremely rapidly, in just five years it went from 44 percent to 48 percent.
The World Economic Forum in Davos has long been criticized by experts and social organizations, as many of them believe the world’s most rich and powerful people, who are actually behind the current crisis, are gathering at a super expensive forum while the world is tanking.
George Soros is the 30th richest person in the world, according to Forbes’ ranking, and had a personal fortune of $19 billion as of March 2013.
The billionaire made a name for himself as the “man who broke the Bank of England” by engaging in questionable Forex hedging, betting against sterling which made him more than $1 billion in one day in September 1992. Some speculate that Soros has been the beneficiary of insider trader information while making investments. In 2002 a Paris court found Soros guilty of using inside information to profit from the 1988 takeover deal for bank Societe Generale.
Last week Soros visited Ukraine to discuss the country’s economy rescue plan with top government officials. The country faces a deep economic crisis and could be on the verge of a debt default.