Schmidt: 'Psychopaths' Fuel U.S. Prices
FRANKFURT, Germany (Reuters) - Former German Chancellor Helmut Schmidt said in remarks published Sunday that U.S. share prices were being driven to unsustainable heights by ''psychopaths'' on Wall Street and that a slump was inevitable.
Schmidt told Welt am Sonntag newspaper that the United States, despite being presented as a shining economic example to Germany, had a private savings ratio below zero and was creating an underclass of the working poor.
``Many people are enthusiastic about the United States at the moment. But people don't realize that the share price boom is totally overvalued and that psychopaths are driving the prices up,'' said the Social Democrat who was West German chancellor from 1974-1982.
``It's only a matter of time before the boom ends and prices tumble down again -- just as it happened in Japan,'' he said.
Schmidt, 80, said that by psychopaths he was referring to ''the young 30-year-old dealers and 40-year-old fund managers who with their daily and hourly fund allocations have no other aim than to get the best possible performance.''
``These people lack an overview of the world and world economy and also of the responsibility that entails.''
Schmidt added the euro's depreciation by as much as 15 percent this year did not signify that the new currency was weak. He said he had witnessed the dollar trading at 3.47 marks and at 1.36 marks in the space of 1-1/2 years.
``No one ever got the idea that that meant the mark was weak,'' he said.