Euro-zone leaders have finally realized the necessity for a bold solution to the continent’s debt crisis, but steps announced so far are not adequate to effectively solve Europe’s economic woes, billionaire tycoon and philanthropist George Soros said on Thursday.
Speaking at a conference organized by the Central European University, Budapest, Soros reiterated the policies he suggested in a Financial Times article in October, including a scheme to guarantee the banking system via the EFSF, and maintaining public finances in debt-ridden countries by issuing treasury bills.
Soros greeted the change in German leaders’ stance toward the euro-zone.
"There has been a substantial change in German leadership, they have realized the mess they have made, and are now determined to save the euro. They know the euro is imperfect, but they can’t actually undo it, just as you can’t unscramble the omelet", Soros said.
On Greece’s debt reduction, Soros said it is imperative that a default must be orderly. Particularly Greek banks need to be kept alive and Greek depositors have to be protected. "If not, then you could have a run on banks in other countries, too, which is what I call a melt-down", Soros added.