29 years ago, on September 16th, 1992, George Soros became known to the world as the man who “broke the bank of England”. George Soros is one of the most frequently heard names in the financial world. His journey to becoming the richest Forex trader in the world was full of controversies, obstacles, and historical events. We have illustrated the timeline of major events that occurred in George Soros’ life.
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Story of George Soros in text
It is not only royals and scientists who make history, there are people who transform the way we perceive and understand certain things. In a chaotic world of trading coming out as a self-made millionaire in a single night is a fairy-tale-like story, but it is exactly what George Soros has accomplished – the man who broke the bank of England. The current year has marked his 90th anniversary and we prepared an illustration of George’s ladder of success with major events of his life and career.
György Schwartz, famously known as George Soros was born on August 12th of 1930 in Budapest, Hungary. Currently, Soros is the richest Forex trader in the world with an estimated net worth exceeding 8.6 billion US dollars. However, his youth has not been that exciting, born into a Jewish family, George and his parents had to split up and hide behind the fake documents to survive the Holocaust. So, eventually, in 1947 Soros’s family moved to London.
George Soros enrolled in the London School of Economics to study philosophy under the famous Karl Popper. Even though Soros acquired bachelor’s, master’s, and a Doctor of Philosophy, Ph.D. degrees, he never again pursued philosophy.
While studying philosophy, Soros was “self-employed”, selling products on the seaside souvenir shops to earn himself enough money for living. It was not long before Soros realized that he was quite good at making money. So he contacted every managing director in merchant banks of London and finally got accepted at the London merchant bank Singer & Friedlander.
First Career Steps
George Soros was initially working as a clerk at Singer & Friedlander of London until 1954 before he moved to the arbitrage department. He got close with one of his colleagues Robert Mayer, who recommended him to apply for the position at his father’s brokerage house F.M Mayer of New York.
26-year-old Soros accepted the offer of his fellow employee and moved to New York in 1956. He remained employed as an arbitrage trader at F.M Mayer for the next three years. George Soros was an expert in European stocks, which was quickly gaining popularity within the US trader community. At that time, the Coal and Steel Community was formed, which later became the Common Market.
After leaving the brokerage house F.M. Mayer, Soros enters Wertheim and Company as an analyst and remains there for 4 more years. By the end of his analyst career, he is already a well-established investor, earning great fortunes with hedge funds. In the 1960s, Soros got the citizenship of the United States and was already a recognized figure in the investor community.
Hedge Funds of Soros
Soon after abandoning the analyst position, Soros moved to Wertheim & Co. At that time, he developed his theory of Reflexivity. However, soon he joined Arnhold and S. Bleichroeder, where he was promoted to Vice President of the company until 1973. He managed to establish an offshore investment fund set up by the board of Arnhold and S. Bleichroeder – First Eagle and the fund was under the direct supervision of Soros himself. After two years, the company granted him another fund – the Double Eagle hedge fund, which he led for another four years until the new federal laws in investment prohibited his direct control of the funds.
As new regulations did not allow Soros to manage the funds at Arnhold and S. Bleichroeder, he established the private hedge fund in 1973 – the Soros fund, which spawned a range of associate companies. The fund, which was rebranded as the Quantum Fund in 1978, earned over 4200% within just 10 years. At the beginning of the 1980s, the fund was already holding 381 million US dollars in assets, whereas George Soros’ estimated net worth grew to 100 million US dollars.
The very first Open Society Foundations of George Soros was established in 1979, which was focused on promoting awareness and public policy among the community. The programs were designed to aid democracy, government accountability, and human rights throughout different projects concentrated in the fields of education, public health, and independent media.
In the same period, Quantum Fund experienced its first major loss causing the company to lose more than half of its capital base. That triggered George Soros to leave the company and delegate his responsibilities to others at Quantum Fund. However, he returns back to investing in 1984.
Soros’ War on Currencies
Soros, as an investor, was famous for his daring and bold investment decisions. It was exactly this kind of attitude that drew his funds to earn millions of dollars annually, however, not all of his risky bets were successful. George Soros, surprisingly, predicted the events that would lead to 1987’s global stock market crash in October, but his expectation of Japanese stocks experiencing the most intense hit was wrong.
However, George Soros’s ability to foresee future opportunities while the markets were struggling got him the name of the investing giant. On 1992, September 16, the British pound took one of the greatest hits in its history, the day that is written in history as “Black Wednesday”. George Soros bet that day 10 billion US dollars against the value of the British Pound and earned himself a billion dollars in a single night. The London press immediately recognizes him as the man who “broke the Bank of England”.
Ironically, the enemy of the fluctuating currencies once again attacks the weakness of the market crash. In 1997, when the Asian financial crisis was in its prime, George Soros allegedly placed an immense bet against the Thai Baht. Some of the sources claim that the initial bet was around 1 billion US dollars and George Soros got an undisclosed amount of earnings since the Bank of Thailand ran out of ammunition to support the Thai Baht and the efforts collapsed.
Soros in Charity
George Soros is one of the most famous philanthropists donating the majority of his earnings to charity causes. In 1996, he donated millions of dollars to promote ballot initiatives in two states of the US, which in fact led to the legalization of the use of medical marijuana. His total charity donations before 2011 were estimated to be over 11 billion US dollars.
In 2011, the fund managed by Soros and his associates closed the door to outside investors and became a family office. Nowadays, the fund is the primary source of financial support to the Open Society Foundations. George Soros himself donated 12 billion on civil initiatives, scholarships, and universities in 2017 and further granted 18 billion US dollars to the Open Society Foundations.
Between 1979 and 2011, he donated more than $11 billion to various philanthropic causes; by 2017, his donations “on civil initiatives to reduce poverty and increase transparency, and on scholarships and universities around the world” totaled $12 billion.