The Soros Downgrade Conspiracy Theory
The UK Daily Mail published a provocative article this morning, wondering if a certain billionaire, who has been known to profit from economic destruction, might have raked in the chips after Standard & Poor’s downgraded America’s credit rating:
A mystery investor or hedge fund reportedly made a bet of almost $1billion at odds of 10/1 last month that the U.S. would lose its AAA credit rating.
Now questions are being asked of whether the trader had inside information before placing the $850million bet in the futures market, or if the bet happened at all.
There were mounting rumours that investor George Soros, 80, famously known as ‘the man who broke the Bank of England’, could be involved.
The Daily Mail concedes that it has no smoking-gun evidence that Soros is the mystery investor who cleaned up after the Obama Downgrade:
The link has been made to Mr Soros in part because he has been tied to President Obama’s administration since 2008, reported The Examiner.
He also recently stopped managing money for outside investors, meaning he is under less scrutiny from the Securities and Exchange Commision
But the mystery bet could easily have been made by another trader with similar resources, despite Mr Soros’s links with the Obama administration.
The bet also raises questions of whether President Obama and Treasury Secretary Timothy Geithner knew that a downgrade was on the cards.
Mr Geithner said in April there was ‘no risk’ of a downgrade – but the government now appears annoyed, not surprised, by last week’s decision.
I can’t help but be skeptical of a conspiracy theory based on underestimating the incompetence of Tim Geithner. No one had to pull any puppet strings to make him spectacularly wrong about the risk of a downgrade.
Other versions of the Downgrade Conspiracy Theory postulate that Obama deliberately caused this economic devastation on orders from Soros, allowing the Left’s obscenely rich international sugar daddy to gobble up huge profits.
Once again, these theories underestimate the sincere blindness and incompetence of Barack Obama, an ideologue who just doesn’t have any ideas beyond raising taxes and spending huge amounts of money. That’s why he staggered onstage yesterday to deliver a statement cobbled together from the exact same things he’s been asserting and demanding since his inauguration. You don’t have to slip someone like that a coded message instructing him to wreck the economy. It’s what he does.
To be perfectly honest, the investor who made 1,000% return on the American downgrade did not require any sinister influence or inside information. He just had to read the actual statements released by the credit agencies, listen to what Obama and the Democrats were saying, and watch that national debt soar into orbit, on its way to the Moon.
It wouldn’t be surprising if there was some kind of inside information leak. That’s standard operating procedure in command economies. As power shifts away from the free market to the political class, billionaires become eager customers for influence. Buying the favor of politicians is much easier than market competition. That’s why so many billionaires are eager supporters of Big Government. They anticipate a very exclusive high-stakes poker table, where the game is played with marked cards, and losses are covered by the little people.