I just happened to turn on CNBC yesterday interested in what they were saying about the stock market drop. They had guys on babbeling on about the GDP and other inflation numbers. I was about to flip it off when they announced George Soros was up next.

What did Soros have to say? First, the market down turn was largely due to Japan’s rising interest rates unwinding the carry trade. I was suprised, I haven’t heard anyone mention this beyond semi-obscure online investment newsletters. Next he said precious metals such and gold got carried away by speculators; that was obvious. Where should you put your money right now? Cash, preferably not in US dollars.

Whether or not you agree with Soros’ political views it is clear that he has a damn good understanding of the global financial markets.