George Soros is the son of the Esperanto writer Teodoro Schwartz. Teodoro (also known as Tivadar) was a Hungarian Jew who was a prisoner of war during and after World War I and eventually escaped from Russia to rejoin his family in Budapest.
The family changed its name in 1936 from Schwartz to Soros, in response to the Fascist threat to Jews. Tivadar liked the new name because it is a palindrome and because it has a meaning. Though the specific meaning is left unstated in Kaufmann’s biography, in Hungarian “soros” means “next in line, or designated successor”, and in Esperanto it means “will soar”. Tivadar wrote of his ordeal to survive in Fascist Hungary, and help many people escape it, in his book Maskerado.
Born August 12, 1930, in Budapest, Hungary, as György Schwartz, George Soros is an American stock investor, philanthropist, and political activist. He peacefully promotes democracy in USA and abroad.
Currently, he is the chairman of Soros Fund Management and the Open Society Institute and is also a former member of the Board of Directors of the Council on Foreign Relations. His support for the Solidarity labor movement in Poland, as well as the Czechoslovakian human rights organization Charter 77, contributed to ending Soviet Union political dominance in those countries. His funding and organization of Georgia’s Rose Revolution was considered by Russian and Western observers to have been crucial to its success, although Soros said his role has been “greatly exaggerated.” In the United States, he is known for having donated large sums of money in a failed effort to defeat President George W. Bush’s bid for re-election in 2004.
Soros has a keen interest in philosophy, and his philosophical outlook is largely influenced by Karl Popper, under whom he studied at the London School of Economics. His Open Society Institute is named after Popper’s two volume work, The Open Society and Its Enemies, and Soros’s ongoing philosophical commitment to the principle of ‘fallibilism’ (that anything he believes may in fact be wrong, and is therefore to be questioned and improved) stems from Popper’s philosophy. Some critics argue that Soros’ static political beliefs appear to conflict with the critical rationalism espoused by Popper, though Soros argues that these beliefs were arrived at through such rationalism.
Soros’ writings focus heavily on the concept of reflexivity, where the biases of individuals are seen as entering into market transactions, potentially changing the fundamentals of the economy. Soros argued that such transitions in the fundamentals of the economy are typically marked by disequilibrium rather than equilibrium in the economy, and that the conventional economic theory of the market (the ‘efficient market hypothesis’) does not apply in these situations.
Whether Soros is theoretically right or wrong on this issue, he certainly has the market credentials and proven track record to effectively maintain that his theory of reflexivity is practically relevant in the marketplace — at least for him. Soros has popularized the concepts of dynamic disequilibrium, static disequilibrium, and near-equilibrium conditions.
Reflexivity is based in three main ideas:
(1) Reflexivity is best observed under special conditions where investor bias grows and spreads throughout the investment arena. Examples of factors that may give rise to this bias include (a) equity leveraging or (b) the trend-following habits of speculators.
(2) Reflexivity appears intermittently since it is most likely to be revealed under certain conditions; i.e., the equilibrium process’s character is best considered in terms of probabilities.
(3) Investors’ observation of and participation in the capital markets may at times influence valuations AND fundamental conditions or outcomes.
Soros argues that the current system of financial speculation undermines healthy economic development in many underdeveloped countries. Soros blames many of the world’s problems on the failures inherent in what he characterizes as market fundamentalism. His opposition to many aspects of globalization has made him a controversial figure. Victor Niederhoffer said of Soros: “Most of all, George believed even then in a mixed economy, one with a strong central international government to correct for the excesses of self-interest.” Soros draws a distinction between being a participant in the market and working to change the rules that market participants must follow.
Credits: Wikipedia (edited as necessary)
Links:
George Soros Official Website
Open Society Institute and George Soros Foundation Network
George Soros: recent interviews
George Soros: video interview at Google
George Soros: MP3 interview on “The Age of Fallibility: Consequences of the War on Terror”