Wall Street ends wild week as Soros eyes recession

George Soros

In a wild week on Wall Street that saw an emergency .75 percentage point rate cut by the Federal Reserve, a global stock sell-off and four days of triple digit moves on the Dow Jones Industrial Average, the market ended down another 171 points, to close at 12, 207.

Meanwhile, billionaire investor George Soros, a strong supporter of MoveOn.org and leftist political candidates, threw cold water on the World Economic Forum in Davos, Switzerland, by warning a recession in the U.S. and UK will be hard to avoid.

In a separate interview with the BBC, Soros told reporters he viewed with enthusiasm the prospect that a coming recession could seriously weaken the U.S.

"I'm not looking for a worldwide recession," Soros said. "I'm looking for a significant shift of power and influence away from the United States in particular and a shift in favor of the developing world, particularly China."

At the end of last week, the Dow reflected a precipitous loss of nearly 2,000 points from the all-time market high of 14,165 recorded Oct. 9, just four months ago.

Investors today apparently were not cheered by yesterday's bi-partisan congressional agreement to support the Bush administration $150 billion economic stimulus package. The plan would send tax rebates to 117 million families in an effort to boost consumer spending.

Gold surged once again, setting a new record as benchmark gold futures for February for delivery on the New York Mercantile Exchange's COMEX metal division hit an all-time high of $924.30 an ounce.

Gold ended the day with February futures contracts closing at $914 an ounce on the COMEX, up $ 8.20 on the day.

Yesterday, the dollar struggled, registering slight gains against the euro, ending at 75.99 on the U.S. Dollar Index, up only slightly from the all-time low of 74.48 registered on the index in December.

Much of the debate at the World Economic Forum centered on the question of "decoupling," whether the world economy could disengage from a recession in the U.S. to stay healthy, or whether the ailing American economy would inevitably throw the world into a tailspin.

With annual retail consumption in the U.S. estimated at over $9 trillion, compared to slightly more than $1 trillion in China and India combined, most attendees felt a consequence of the increasing economic globalism could easily be a worldwide recession unless Bush administration stimulus efforts were enough to jumpstart the U.S. economy.

Soros, speaking to reporters in Davos, accused Federal Reserve Chairman Ben Bernanke of acting in a "panicky way," cutting rates as much as .75 percentage points this week, according to the Financial Times.

Still, Wall Street investors at market close today strongly encouraged the Fed to cut rates another .25 percentage points at next week's scheduled meeting of the Federal Open Markets Committee.

Editor's note: The November issue of WND's monthly Whistleblower magazine, titled "HOW GLOBALISM IS DESTROYING THE U.S. ECONOMY" – focuses exclusively on the future of the U.S. economy, and answers key questions like: "If inflation is so low, how come food and energy cost so much?" "What is the 'housing bubble,' and why did it burst?" "What's really going on with the stock market?" "Is America heading into a recession?" "Will the dollar collapse in 2008?" and "What will happen to the price of gold?"

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