Soros, Dalio Say Germany May Be Likeliest to Leave Euro Zone
Ray Dalio, the billionaire investor who runs the world’s largest hedge fund, and billionaire George Soros this week said Germany could leave the euro zone.
“If anyone is going to be forced out, it’s more likely that the Germans will be forced out,” Dalio, founder of Bridgewater Associates LP, said during a talk at the Council on Foreign Relations in New York this week. “Southern Europeans have the votes that control the monetary policy. You let them vote, they will vote to print money.”
In Germany, the region’s largest economy, the highest court cleared the way for a permanent European bailout fund to start operating. Yields on Spanish and Italian government bonds have fallen from their July highs as European leaders took steps to contain the debt crisis and European Central Bank President Mario Draghi this month announced unlimited debt purchases.
Dalio, whose Bridgewater Associates manages about $130 billion, said that the fiscal transfer of wealth from Germany is “going to fall short.” He also said there will be 2 trillion euros ($2.5 trillion) worth of losses on current European debt.