0:00
as the fall of 1992 unravels the warmth
0:02
of a spent summer still lingers yet the
0:05
Sterling is in freefall plummeting
0:08
point at the vortex of this turmoil
0:10
stands a solitary figure a man who
0:13
orchestrated one of the biggest
0:14
Financial heists of the 20th century and
0:17
earned the moniker the man who broke the
0:19
bank of England this is the story of
0:22
George Soros The Legend Who harnessed
0:25
his difficult past to forge the quantum
0:27
fund one of the most successful hedge
0:30
and secure his status as the greatest
0:38
time born into a prosperous Jewish
0:40
Family in the heart of Budapest George
0:42
was the son of idar Soros a man who had
0:45
tasted the harsh realities of Life as a
0:48
prisoner of war during World War
0:50
I and spent three grueling years on the
0:53
run in Siberia George once discussed his
0:56
father's time as a wartime captive
0:58
explaining he went through a horrendous
1:00
experience and that taught him a lesson
1:02
which then came in very useful he in
1:04
turn taught me a lesson which came in
1:06
useful to me which is the art of
1:09
Survival by the time George was born
1:12
tadar had transformed his life becoming
1:14
a successful lawyer in Budapest and a
1:17
strong pillar of his family early on
1:19
tivadar imparted the lessons of
1:21
resilience and survival to young George
1:24
lessons that would soon become his
1:25
Lifeline not just in his stormy
1:27
childhood but in his future career as a
1:29
speci UL in 1933 the world watched as
1:33
Adolf Hitler ascended to power and by
1:35
Spring 1944 the iron grip of narcism had
1:39
seized Hungary as fear intensified and
1:42
weaved a dark web over Europe George's
1:44
father determined to protect his wife
1:46
and kids moved them from one hiding
1:48
place to another they adopted false
1:50
identities falsified papers and even
1:53
authorities to hide their Jewish
1:55
identity idar changed his Family's last
1:58
name to saw Rose inspired by the
2:00
Esperanto word sorry meaning to
2:04
S ironically this fresh Alias would take
2:07
on a deeper meaning as George's success
2:09
would rise to unprecedented Heights
2:11
finally when the war ended in 1945
2:14
George and his kin were able to make
2:17
Budapest however their lives were
2:19
forever marked by experiences of the war
2:22
in a surprising Twist of human
2:23
resilience George described his time
2:25
under the Nazi occupation as the
2:27
happiest time of his life for young
2:30
George each day had felt like an
2:32
exciting Journey akin to living out the
2:34
plot of Raiders of the Lost Ark he
2:37
recalled not only did we survive but we
2:40
managed to help others however the end
2:42
of the Nazi occupation brought no relief
2:44
for the rest of the country or for
2:46
George's family instead it marked the
2:48
beginning of another nightmare the
2:50
Russian occupation beginning in
2:53
1945 at this time Sor Rose's mother was
2:56
raped by two Soviet soldiers in broad
2:58
daylight an incident that deeply scarred
3:00
young Soros and led him to search for a
3:03
better life elsewhere rejecting the
3:12
past in a heart-to-heart talk with his
3:15
father the young George revealed his
3:16
yearning to leave Budapest his eyes were
3:19
set on two different Horizons Moscow
3:22
drawn by a curiosity to understand the
3:24
Machinery of Communism and London lured
3:28
BBC idel his life heavily marked by the
3:31
scars of Communism assured George that
3:33
he could provide all the lessons he
3:35
needed about the system's harsh
3:38
realities after a handful of lengthy
3:40
conversations the two had George was
3:42
left with one Clear Choice London so in
3:47
the year 1947 17-year-old George SAR
3:50
Rose found himself on a journey away
3:52
from the Iron Fist of Communism that had
3:54
clenched Budapest his mission was to
3:57
understand the world beyond the Iron
3:58
Curtain and in doing so discover himself
4:02
but after arriving in London it became
4:04
clear that George's success would not be
4:05
immediate he found himself peniles and
4:08
alone an outsider looking in it was in
4:11
this new city that George first
4:13
discovered what true loneliness felt
4:15
like he found work as a waiter surviving
4:18
on leftovers from customers to fuel his
4:20
dreams of receiving a solid education in
4:23
1947 George Soros found himself stepping
4:26
through the doors of the prestigious
4:28
London School of economics
4:30
these hallowed Halls quickly became his
4:32
Haven filled with the Echoes of
4:34
intellectual giants like KL POA whose
4:36
teachings would shape sorro's worldview
4:38
and future investment
4:40
philosophy most notably Poppa's
4:42
revolutionary concept of falsifiability
4:45
had a profound impact on Soros this
4:47
philosophical perspective would
4:48
significantly shape Soros understanding
4:50
of the stock market's workings though he
4:52
wasn't aware of how just yet Sor Rose
4:55
was a solitary figure throughout most of
4:57
his education his existence revolving
5:00
primarily around his academic Pursuits
5:02
by 1951 Sor Rose had earned a BSC in his
5:06
favorite subject philosophy however the
5:09
financial burden of graduate school was
5:11
heavy and it forced him to divide his
5:13
time between his studies and laborious
5:15
jobs he found himself serving tables and
5:18
working as a railway Porter to keep his
5:20
dream alive but Sor Rose was determined
5:24
his tenacity rewarded with a master of
5:26
science degree in philosophy in 1954
5:30
influenced by his mentor KL poer Sor
5:32
Rose was Resolute in his ambition to
5:36
post-graduation however this first and
5:38
foremost required Financial stability
5:41
George's plan was to amass a sum of
5:44
$500,000 over a span of 5 years which he
5:47
assumed would be enough to sustain his
5:48
career as both a writer and philosopher
5:52
on a quest to secure his financial
5:53
future Sor Rose turned his gaze towards
5:56
the world of Finance he penned letters
5:58
to every managing director of every Bank
6:00
in London his persistence paid off when
6:03
he landed a job at singer and
6:04
friedlander a well-respected merchant
6:06
bank before long Soros immersed himself
6:09
in the world of Arbitrage exploiting
6:11
price differences for profit during this
6:14
period international trade was heavily
6:16
concentrated on gold and oil stocks
6:19
necessitating a particular kind of
6:20
currency known as premium dollars while
6:23
official exchange rates were set in
6:25
stone the currencies utilized for
6:27
Capital transactions would vary Beyond
6:29
the official range driven by market
6:33
demand Sor Rose's trading abilities
6:35
swiftly garnered the notice of his
6:37
co-workers with one proposing he take up
6:39
a role at his father's brokerage firm FM
6:42
mayor located in New York George saw
6:45
this as a chance to grow his income and
6:47
take one step closer toward his dream
6:50
philosophy so Sor Rose left his position
6:53
at singer and freedlander and set his
6:55
sights on the promise of the American
6:56
dream at the time he was only 26 years
7:00
old this is how in 1956 Sor Rose landed
7:03
in New York City where he took on roles
7:05
as a Trader security analy and
7:09
salesman while he hoped this would be
7:11
his big break the world of Finance was
7:13
not easily tamed during the formation of
7:15
the European common market there was a
7:17
surge in interest in European Securities
7:20
a world sore Rose quickly became
7:22
immersed in this lucrative Venture
7:25
however was halted when President John F
7:27
Kennedy enforced the interest
7:28
Equalization tax which included a
7:30
substantial 15% search charge on foreign
7:34
Securities this change LED Sor Rose to
7:36
redirect his Focus toward us Securities
7:39
an Avenue he hoped would be more
7:40
profitable drawing from the tumultuous
7:43
experiences of his Youth and the
7:44
philosophical teachings of KL popper
7:46
Soros began to perceive Finance as a
7:48
chaotic system influenced by two key
7:53
expectation Sor Rose proposed that a
7:56
disparity always exists between these
7:58
two elements and and it is within this
8:00
Gap that trading opportunities are found
8:03
he was convinced that there existed a
8:04
reciprocal relationship between an
8:06
Investor's mindset and the markets they
8:08
engage with Sor Rose once famously
8:11
Illustrated this concept with an analogy
8:14
of walking down a street in New York
8:15
City if he was fearful of being robbed
8:18
he might become excessively wary making
8:20
him an easy target leading to the very
8:22
act he feared getting mugged Sor rose
8:26
contended that the stock market may not
8:28
function so differently
8:29
if investors are optimistic about a
8:31
Stock's potential rise and they all
8:33
decide to invest then the stock will
8:35
indeed rise however once it becomes
8:38
overvalued and a bubble is created it's
8:42
eventually this knowledge which comes
8:44
from what Soros calls the theory of
8:46
reflexivity presents an ideal
8:48
opportunity for Traders and investors to
8:50
ride a boom while it's going up but jump
8:53
before the bust let's rewind to
8:56
1974 when 17-year-old George found him
8:59
himself reading Carl popper while
9:01
studying at the prestigious London
9:03
School of Economics Carl put forth that
9:05
no perfect knowledge exists at the same
9:07
time George's economic professors argued
9:10
for perfect knowledge and touted the
9:11
efficient market hypothesis these two
9:14
ideas can't coexist so which one is
9:17
right according to George poer is right
9:19
and a good thing for him because if he
9:21
didn't he wouldn't be a
9:22
multi-billionaire that he is today after
9:24
studying poer George had two key
9:27
insights that were fundamental to him
9:29
Conquering the markets one investors are
9:31
fallible they make imperfect decisions
9:34
based on incomplete information and two
9:36
markets are reflexive investors imp
9:39
perfect actions move the very markets
9:41
they're a part of and while this might
9:43
seem like common sense it has massive
9:46
implications if you think deeply about
9:47
it it means that every Market move has
9:50
two components an underlying Trend based
9:53
in reality and a misconception related
9:55
to that Trend if you can spot a trend
9:58
and its misconception you're well in the
10:00
way to understanding the markets and
10:02
which Trends are most likely to turn
10:04
into Mega Trends and throughout the 50s
10:06
and 60s George applied this concept to
10:09
achieve extraordinary success in the
10:10
Securities markets wowing those around
10:13
him and quickly gaining the attention of
10:15
Wall Street he had an uncanny sense for
10:17
finance intuitively grasping and
10:20
understanding the logic of Market
10:21
movements but by 1969 George was ready
10:25
to use his tried andrue theory of
10:26
reflexivity to achieve something much
10:28
greater than originally planned he
10:30
tapped into the network of investors
10:32
he'd cultivated over the years
10:34
leveraging these relationships to fund
10:36
the next step of his career and it
10:38
worked in that same year Sor Rose was
10:41
able to launch his inaugural hedge fund
10:43
Double Eagle it was a bold move
10:45
especially for the time
10:47
period George Soros belongs to the first
10:50
generation of hedge fund managers there
10:52
were only a handful like him when he
10:53
founded Double Eagle making this new
10:55
Venture particularly
10:57
audacious George ge's first move as a
11:00
hedge fund manager he made a bold
11:02
prediction based on the reflexivity
11:04
theory he guessed that real estate
11:06
investment trusts were on the precipice
11:07
of a significant surge in value but
11:09
would crash in just a few short years so
11:13
armed with $4 million of investor
11:15
capital and a quarter of a million of
11:16
his own money Sor Rose rode the wave of
11:19
this trend he was not a mere Observer he
11:22
was a Speculator a player in the game
11:25
Sor Rose made a million dollars on the
11:26
way up and when the inevitable crash
11:28
happened he shorted them accruing even
11:31
more on the way down then in 1973 Sor
11:35
Rose leveled up and joined forces with
11:37
Jim Rogers who he'd met while working at
11:39
singer and freedlander he renamed Double
11:42
Eagle to the Sor Rose fund which would
11:44
later become the quantum fund one of
11:47
this team's primary focuses was on
11:49
global macro investing a strategy that
11:51
would soon prove to be incredibly
11:53
profitable it involved pinpointing
11:55
macroeconomic trends like shifting
11:57
currency rates variable interest rates
12:00
and significant political changes to
12:02
make Strategic investment choices
12:05
needless to say Soros and Rogers made
12:07
for a powerful partnership by the end of
12:10
1973 soros's hedge fund was worth an
12:13
astonishing $50 million George's
12:15
strategy his insight and his daring
12:18
moves were finally paying off yet
12:21
George's moves only grew more daring
12:23
from here in the' 70s for example Soros
12:26
had a hunch that the banking sector was
12:28
on the edge of a boom he saw that for a
12:30
long time Banks had been considered
12:32
stuffy institutions Bound by government
12:34
regulations and uninteresting to
12:36
investors seeking capital gains however
12:39
George also perceived a shift in the
12:41
wind a fresh generation of Bankers was
12:44
Rising as certain Banks began to wield
12:46
their Capital with more audacity
12:48
delivering remarkable earnings
12:50
performances for investors in 1972 Soros
12:54
penned a report titled the case for
12:56
growth banks in which he postulated that
12:58
bank stock were on the brink of
12:59
Awakening he encouraged his traders to
13:01
buy as many shares as possible in major
13:03
Banks and needless to say his intuition
13:06
was spoton the shares soared by 50% in
13:09
less than a year generating a windfall
13:11
of profits in the first decade of the
13:13
quantum fund its total profits
13:17
300% it was clear by this point that Sor
13:20
Rose was not just a player in the game
13:22
he was a GameChanger a force to be
13:24
reckoned with in the world of
13:26
Finance the name George Soros was
13:29
quickly becoming synonymous with
13:30
financial Acumen and success however the
13:33
late 1970s proved to be a decade of
13:36
tumultuous economic upheaval that would
13:38
threaten Sor ros' Legacy as
13:40
hyperinflation gripped the United States
13:43
the once Mighty Dollar began to crumble
13:45
losing its value at an alarming rate
13:47
unemployment soared reaching
13:49
unprecedented levels and the nation was
13:52
in the throws of a financial crisis amid
13:55
this chaos George Sor Rose saw not
13:57
disaster but opportunity
13:59
he forecasted the occurrence of an
14:01
inverted yield curve a phenomenon where
14:03
long-term bonds are more sought after
14:05
than short-term bonds and stocks and so
14:08
George made his move going long on
14:11
long-term bonds and short on short-term
14:13
ones but the economy stubborn and
14:16
resilient held together longer than
14:18
Soros had anticipated while his initial
14:21
prediction was correct his timing was
14:23
tragically off the result was a
14:25
devastating loss of $80 million or 22%
14:28
for his fund half of his investors
14:31
withdrew their money questioning whether
14:33
this was the end of the line for Soros
14:36
George decided to retreat from the
14:37
financial Battlefield retiring and
14:39
leaving Quantum Fund in the hands of Jim
14:41
Marquez and a team of managers and under
14:44
new leadership the fund made a
14:46
remarkable comeback generating a 56.9%
14:50
1982 it seemed the quantum fund didn't
14:53
need George Sor Rose after all and that
14:55
his career in finance might really be
14:56
over but the following year year Quantum
14:59
fund saw a mere 9% gain under its new
15:02
leadership a disappointing turn of
15:04
events for George this was like Batman
15:06
seeing the bat signal pop up in the sky
15:09
it propelled him swiftly into
15:11
action in 1984 Sor Rose emerged from
15:14
retirement returning to the Helm of the
15:16
quantum fund and from there he went
15:19
straight to business rescuing its
15:21
reputation his first order of business
15:24
capitalizing on Impending Doom after
15:27
observing the current economic landscape
15:29
of the United States George Sor Rose
15:31
believed that Reagan's politics would
15:33
plunge the country into a depression he
15:35
found Reagan's adherence to Market
15:38
fundamentalism and the belief in the
15:39
self-correcting nature of financial
15:41
markets to be fundamentally flawed it
15:44
went directly against his own theory of
15:47
reflexivity so George Soros decided to
15:50
make a bold move and bet against the
15:51
American economy he took a long position
15:54
on the Japanese Yen and the Deutch Mark
15:56
while shorting the US dollar and Cru oil
15:59
George's prediction proved accurate in
16:01
1985 when central banks began devaluing
16:04
the American dollar the United States
16:07
currency plummeted by 133% and then a
16:09
further 25% the following year this
16:12
strategic gamble resulted in a windfall
16:14
of $150 million for Soros and his fund
16:18
proving that the king had truly returned
16:20
to his throne of course great challenges
16:23
were still on the horizon the 1987
16:25
financial crash was a pivotal Moment In
16:27
global economics marking the end of an
16:29
unstable and unsustainable worldwide
16:32
stock boom Sor Rose at the Helm of the
16:35
quantum fund experienced substantial
16:38
losses in this downturn with the fund
16:39
plunging by 30% following the market
16:42
collapse once more this caused George
16:45
Soros to question the longevity of his
16:47
prosperous investment career yet it was
16:50
on a day etched in infamy the 16th of
16:52
September 1992 black Wednesday that
16:55
Soros would orchestrate the most
16:57
successful Gamble of his career one that
16:59
would earn him the moniker the man who
17:03
England before we understand the trade
17:05
we need to understand the setup in 1972
17:08
the European economic Community
17:10
currencies were pegged to each other in
17:12
a scheme called the snake in the tunnel
17:14
which created a single currency band
17:16
combining the currencies together this
17:18
slyther ERM did make it easier to
17:20
transact across borders and paav the way
17:22
for a single European currency but it
17:24
put pressure on each country's Central
17:27
Bank and collapsed a year later the UK
17:29
entered the ERM in October 1990 agreeing
17:32
to join with a fluctuation ban of 6% at
17:36
Entre the pound sterling had 15%
17:38
inflation three times the rate of
17:40
Germany and low labor productivity but
17:42
joining house Slytherin wasn't a Magic
17:45
Bullet over the next 2 years the
17:47
economic climate in the UK went from bad
17:49
to worse as the economy continued to
17:51
shrink with an inverted yield curve and
17:53
on the other end of the snake again
17:55
Germany being the anchor kept interest
17:57
rates high so demand for its currency
17:59
stayed high and if this wasn't bad
18:01
enough the UK had double deficits the
18:04
government was spending more than it was
18:05
making from taxes and it was also
18:07
spending more on trade than it was
18:08
earning all of these factors weakened
18:10
demand for the pound over time forcing
18:13
the UK Central Bank to foro its foreign
18:15
currency reserves and buy its own
18:17
currency the writing was on the wall
18:19
setting up one of the greatest trades in
18:21
history starting in August 1992 dren
18:24
Miller Soros began building a position
18:27
the trade thesis was was simple the
18:29
snake in the tunnel was unsustainable
18:31
and the artificial demand from the
18:32
central banks would eventually break
18:34
they started shorting the pound and the
18:36
Italian L they would borrow these
18:37
currencies from the banks to buy German
18:39
marks while paying interest the idea is
18:42
that when the ERM broke the currencies
18:43
would drop relative to German marks and
18:45
they would buy back the currencies at a
18:47
discount earning the difference minus
18:49
interest paid as profit on the 13th of
18:51
September Germany cut interest rates by
18:54
.25% or 25 basis points causing the
18:57
Italian lra to drop dropped by 7% in
18:59
response around 10:30 a.m. on September
19:02
16th 2 hours later the British
19:04
government made a fatal mistake they
19:06
announced an increase in the base rate
19:08
from 10% to 12% to tempt speculators to
19:11
buy pounds and cost the short sellers
19:13
money their move backfired it was
19:16
clearly seen by the markets for what it
19:17
was an act of desperation Traders
19:19
smelled blood they dumped pounds as fast
19:22
as they could the currency eventually
19:24
devalued by around 20% making short
19:26
sellers of Fortune especially for George
19:28
and Stanley who had the foresight to see
19:30
the inevitable and bet big this high
19:33
stakes High leverage maneuver was indeed
19:36
sorro's most renowned accomplishment
19:38
serving as a prime illustration of his
19:40
ingenious trading methods yet it didn't
19:43
signify the end of his Endeavors just
19:45
yet George continued to tirelessly work
19:48
for Quantum fund and its investors for
19:50
several more years until his health
19:51
became a concern one day in the midst of
19:55
a frantic Rush between Banks a sudden
19:57
sharp pain seized George's chest hinting
20:00
at the onset of a heart attack his heart
20:03
pounded like a gavl each beat a verdict
20:06
on his life's choices the world of
20:08
Finance was a game and he was a master
20:11
player but the stakes had suddenly gone
20:13
too high the numbers on the screens once
20:16
a source of thrill now seemed Hollow
20:18
devoid of meaning in the face of his own
20:20
mortality Sor Rose stood there in the
20:22
heart of the financial World a Titan
20:24
among men yet as vulnerable as any it
20:27
was at this moment he asked himself why
20:30
should I keep killing myself making
20:36
money in the midst of 2011's swirling
20:39
Financial currents George having
20:41
navigated the high seas of high stakes
20:42
investing and concerned for his health
20:45
chose to sail into quieter Waters he
20:47
reimagined his fund once the game board
20:49
of highflying investors into a family
20:52
office a refuge for his wealth and
20:54
Legacy this was not a retreat but a
20:58
The Grandmaster stepping back from the
21:00
chessboard to contemplate a broader
21:02
Horizon in this new chapter George
21:05
sought not just a successor but a
21:07
kindred spirit who shared his vision
21:10
Stanley dren Miller emerged not merely
21:12
as an heir to a financial Dynasty but as
21:14
a continuation of a philosophy he was a
21:17
man shaped by humility yet his ambition
21:19
soared his respect for George rooted in
21:22
shared values long before their paths
21:24
intertwined George whose name had become
21:27
synonymous with Brazen bet against the
21:29
British pound had accumulated not only
21:31
wealth but also the influence to shape
21:34
discourse his true calling transcended
21:36
financial markets he was now a
21:38
philosopher in action his life's work
21:40
and Essay in the currency of open
21:42
societies and the pursuit of a world
21:44
Unshackled by tyranny the yield from his
21:47
financial Ventures was impressive a
21:49
staggering 20% annualized return across
21:51
four decades yet now George sought a
21:54
different sort of profit social
21:56
dividends measured Injustice Democratic
21:58
norms and the upliftment of human rights
22:02
in 1993 the open societies Foundation
22:05
sprang forth from George's Vision a
22:07
homage to his intellectual load star
22:09
Carl poer the foundation became the
22:11
instrument of George's will to Shield
22:13
others from the Shadows he once knew it
22:16
was an arc carrying his resolve across
22:18
the tumultuous Waters of global politics
22:21
injustice the foundation's handprints
22:24
are seen in history's pivotal moments
22:26
the push of czechoslovakia's Revolution
22:29
and the bolstering of South African
22:30
students through scholarships during the
22:32
suffocating era of aarid George's reach
22:35
has extended from the thriving
22:36
Millennium villages in Africa to the war
22:38
torn streets of Saro his philanthropy a
22:41
testament to his youthful dreams now
22:43
rendered into a vivid Mosaic of global
22:45
impact yet a man of such power and
22:48
impact always attracts enemies critics
22:51
have thrown doubt on George's story of
22:53
Goodwill claiming he has a hidden agenda
22:56
they accuse him of manipulating finances
22:58
and wielding undue influence but often
23:01
these claims are tinged with
23:03
anti-Semitism an old ghost used to
23:05
undermine his life's
23:06
work yet George's resolve is iron shaped
23:10
in The Crucible of his past the fusil ad
23:12
of criticism is but a whisper against
23:14
the storm of his Endeavors his
23:16
philanthropy is an unceasing March a
23:19
testament to a will that has weathered
23:20
both the physical threats of Nazi
23:22
oppression and the digital barrages of
23:25
skepticism as the pages of 202 23 turn
23:29
the torch is passed to his son Alexander
23:31
Sor Rose a bearer of a new dawn for the
23:35
Foundation he inherits not just the
23:37
mantle of his father's Empire but the
23:41
activism in the press's glare Alexander
23:43
pledges to deepen the ideological battle
23:46
his voice a Clarion call for rights and
23:48
democracy a promise to Champion the
23:50
family's Legacy The Narrative of George
23:53
Soros thus weaves through the annals of
23:55
finance and the tapestry of global
23:57
activism a life echoing the lessons of a
23:59
childhood brushed by fascism now carried
24:02
forward through the voice of his progeny
24:04
his Ledger is Wall Streets but his story
24:06
belongs to the world a saga of struggle
24:09
resilience and unwavering pursuit of a