November 13, 2008 11:07 am EST
George Soros, chairman of Soros Fund Management, testified at a House Oversight and Government Reform Committee hearing on Thursday. Highlights:
- Said "a deep recession is now inevitable and the possibility of a depression cannot be ruled out."
- Said hedge funds were an integral part of the financial market bubble which now has burst.
- Said hedge funds will be "decimated" by the current financial crisis and forced to shrink their portfolios by 50-75 percent.
- Said Fed, Treasury Department and the SEC must accept responsibility to prevent market bubbles from growing too big in future.
- Said impossible to prevent market bubbles from forming, but they can be kept within "tolerable bounds."
- Said financial engineering should be regulated and new products approved by regulators, and that such regulation should be a high priority of the new Obama administration.
- Said a recent IMF credit facility not large enough to stabilize markets.
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