U.S. Stock Market Crash Imminent In 2014? George Soros Bets $2.2 Billion On U.S. Economic Collapse

George Soros is making a $2.2 billion bet that the U.S. stock market will drop significantly in the foreseeable future. But other major business owners have issued more ominous warnings about a U.S. economic collapse.

In a related report by The Inquisitr, the CBO has Social Security Disability running out of money by the year 2016, although it’s possible their estimate may be off by a year in either direction. The CBO also previously projected the entirety of the Social Security Fund, not just the disability fund’s portion, will run out of money in the 2030?s. When Congress avoided another fiscal cliff by saving the Highway Trust Fund they did so by using two methods that critics consider to be political gimmicks since they essentially amounted to borrowing money now with the promise to pay it back years down the road with taxes and offsets.

Recently, Soros Fund Management increased his short position on the S&P 500 from 2.96 percent of the portfolio to 16.65 percent, making it the biggest single portion of everything George Soros is managing. All in all, the hedge fund manager increased this short position all the way to $2.2 billion.

Soros also doubled his ownership in Gold ETF stocks, which can be influenced by the value of the U.S. dollar. Goldman Sachs, on the other hand, believes gold prices could drop to $1,050 per ounce in 12 months.

Essentially, this could mean that Soros believes the U.S. stock market could tumble and is hedging his bets. But NewsMax reports that “rival money managers cautioned against putting too much weight into what is apparently a pessimistic view of U.S. stocks, given that Soros Fund Management may simply be looking for a hedge to counterbalance its many long stock positions.”

In 2006, Robert Wiedemer and a team of economists foresaw the coming collapse of the U.S. economy and claimed that 2012 would start a trend toward “50% unemployment, a 90% stock market drop, and 100% annual inflation.” This claim is highly controversial, although some are worried that Wiedemer could even be partially on target.

For example, Donald Trump recently said:

“When you’re not rich, you have to go out and borrow money. We’re borrowing from the Chinese and others. We’re up to $16 trillion in debt. We are going up to $16 trillion [in debt] very soon, and it’s going to be a lot higher than that before he gets finished. When you have [debt] in the $21-$22 trillion, you are talking about a downgrade no matter how you cut it.”

Businessman Wayne Gorsek lived the American dream by starting a small company that eventually made the INC 500 Hall of Fame and allowed the man to retire early as a multi-millionaire. Bored of retirement and flying jets, Gorsek decided to launch multiple vitamin companies but the U.S. economic picture seemed very different this time around:

“I made the decision to invest $26 million during the worst economy since the Great Depression. Shouldn’t entrepreneurs and financial risk-takers like me be thanked and rewarded? Instead I feel demonized, denigrated, targeted and punished. Fear and uncertainty of the government is reason number one why there is a lack of quality full time jobs.”

In the end, Gorsek also believes that the U.S. economy is on the path to ruin:

“If Americans fail to elect politicians that will actually reduce taxes and regulations, and make it harder to file frivolous lawsuits (with loser pay laws), as well as reduce the size and spending of government, while providing incentives for businesses creating the jobs, you will see the continued decline of the U.S. economy, the death of good jobs and the murder of the middle class. We’re staring at the end of the American Dream.”

To put these claims into perspective, the politically neutral CBO also claims the high federal debt could cause an U.S. economic collapse:

“Large federal budget deficits over the long term would reduce investment, resulting in lower national income and higher interest rates than would otherwise occur…. When the amount of outstanding debt is relatively small, a government can borrow money to address significant unexpected events—recessions, financial crises, or wars, for example. In contrast, when outstanding debt is large, a government has less flexibility to address financial and economic crises—a very costly circumstance for many countries…. A large and continuously growing federal debt would have another significant negative consequence: It would increase the likelihood of a fiscal crisis in the United States.”

The good news is that the United States is not Greece, which began to fall apart when their federal debt reached 100 percent of their GDP. But this is not an immediate death knell for a country. For example, Japan still manages to function as a country and its debt to GDP in 2013 was 227 percent. Market Watch also believes a U.S. stock market drop won’t happen and wrote an article listing 30 reasons they believe this to be the case.