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Hedge funds are a very efficient way of managing money. But there are clearly some risks. Hedge funds use credit and credit is a source of instability. Transactions involving credit should be regulated.

George Soros

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George Soros
Age: 94
Born: 1930
Born: August 12
Banker
Business Magnate
Businessman
Economist
Financier
Investor
Philanthropist
Philosopher
Trader
Writer
Buda Pest
György Schwartz
György Soros
Fund
Regulated
Clearly
Instability
Credit
Transactions
Source
Managing
Risk
Funds
Use
Involving
Money
Risks
Way
Efficient
Hedge

More quotes by George Soros

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Markets are designed to allow individuals to look after their private needs and to pursue profit. It's really a great invention, and I wouldn't underestimate the value of that. But they're not designed to take care of social needs.
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Well, you know, I was a human being before I became a businessman.
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Advocating democracy has, by other people, often been taken as a form of imperialism, and not without some justification. So the important thing in a democracy is that it doesn't necessarily have to agree with what America's interests are, and it doesn't necessarily have to be serving American interests.
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I have made it a principle to give advice that does not serve my personal interest but rather the common interests.
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I contend that financial markets never reflect the underlying reality accurately they always distort it in some way or another and the distortions find expression in market prices. Those distortions can, occasionally, find ways to affect the fundamentals that market prices are supposed to reflect.
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The lower interest rates fueled housing and consumption booms in countries such as Spain and Ireland. At the same time, Germany, struggling with the burdens of reunification, tightened its belt and became more competitive. All this led to a wide divergence in economic performance. Europe became divided into creditor and debtor countries.
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The generally accepted view is that markets are always right -- that is, market prices tend to discount future developments accurately even when it is unclear what those developments are. I start with the opposite view. I believe the market prices are always wrong in the sense that they present a biased view of the future.
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When you sell options, you get paid for assuming risk. That can be a profitable business, but it does not mix well with the risks inherent in a leveraged portfolio.
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Giving government aid to a bank basically transforms it into a utility. The huge salaries in this sector are only a symptom of a more profound misalignment. The profitability of the finance industry has been excessive. [...] That was absurd.
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At times of recession, running a budget deficit is highly desirable. Once the economy begins to recover, you have to balance the budget. But it will also need additional revenues. Should the government not receive them, we will all get punished with higher interest rates.
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I am not well qualified to criticize the theory of rational expectations and the efficient market hypothesis because as a market participant I considered them so unrealistic that I never bothered to study them.
George Soros
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The concept of a general equilibrium has no relevance to the real world (in other words, classical economics is an exercise in futility).
George Soros
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Market prices are always wrong.
George Soros
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There is always a divergence between our perception and what actually exists.
George Soros
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If the bubbles contain a misconception, as they always do, then it can't be maintained forever.
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Law has become a business. Health care has become a business. Unfortunately, politics has also become a business. That really undermines society.
George Soros
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Changeless society is characterized by the absense of alternatives.
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Financial markets ... resent any kind of government interference but they hold a belief deep down that if conditions get really rough the authorities will step in.
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A lot of the evil in the world is actually not intentional. A lot of people in the financial system did a lot of damage without intending to.
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As a society we can't live without moral considerations. We do have to protect the public good. And markets are not designed to do that, so we need a political process.
George Soros