Financier says imbalance represents biggest threat of international economic collapse.
According to a report by AFP, former global currency markets player and current day philanthropist George Soros warned recently that the growing trade imbalance between the United States and China represents the biggest threat of an international economic collapse.
"There is a clear disequilibrium that the U.S. is consuming 7% more than it produces and countries like China are producing significantly more than they consume," he said, adding that Peking had built up a $1.2 trillion surplus, which is growing fast.
"There could be a balanced correction of the disparity but, on the other hand, it could also be difficult and hard," Soros explained.
He added that the decline in the dollar's value could accelerate if central banks and foreign investors were spooked into switching their cash reserves into other currencies.
"What is now a very gentle decline in the dollar could accelerate and that could be disruptive," added Soros, who was speaking at a debate in Prague connected with his book "The Age of Fallibility."
The single European currency is developing into a counterweight to the dollar, with rich Gulf oil states choosing to keep some of their surplus cash in euros. But that trend also risks creating "serious disruption" if it develops outside current acceptable bounds, Soros said.
The American billionaire financier and speculator, famous for "breaking" the Bank of England in 1992, now devotes most of his time and money to foundations, such as the Open Society Institute, aimed at encouraging democracy.