Quote:
Originally Posted by Pete F.
How did Soros make a billion dollars in a day?
Others lost.
He's a trader, not an investor.
George Soros is most famous for his single-day gain of $1 billion on September 16, 1992, which he made by short selling the British pound. At the time, England was part of the European Exchange Rate Mechanism, a fixed exchange-rate system that included other European countries. The other countries were pressuring England to devalue its currency in relation to the other countries in the system or to leave the system. England resisted the devaluation, but with continued pressure from the fixed system and speculators in the currency market, England floated its currency and the value of the pound suffered. By leveraging the value of his fund, Soros was able to take a $10 billion short position on the pound, which earned him $1 billion. This trade is considered one of the greatest trades of all time, and Soros is often credited as the man who broke the Bank of England.
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"How did Soros make a billion dollars in a day?
Others lost."
The loss of others, was NOT a requirement for Soros to win. Like many ignorant people, you think the economy is a zero sum game. It's not. There's no mathematical law saying that someone has to fail in order for someone else to succeed. It's not finite. It's possible that every stock on the exchange can go up in a given day, that does NOT mean anyone else necessarily lost anything. How can you not get that?
Others losing, isn't "how" he won, not unless he cheated. Are you saying he cheated? Was he involved in a 'pump and dump'?
He bet the value of the pound would decrease. His bet, did not
cause the pound to decrease.