To prevent the speculative ``bubble'' created by the stock market boom from bursting, Soros called for the establishment of international institutions ``capable of averting excesses and too much instability''- a function which he said the International Monetary Fund (IMF) was not in a position to fulfil.

``What the IMF is doing now is not working. It was devised for another environment,'' Soros said, accusing IMF leaders of having ``misunderstood how markets operate'' since the start of the Russian economic crisis at the beginning of the decade.

``Raising interest rates to try to stop a currency collapsing, in fact strengthens attacks against this currency because that helps to undermine the solvability of lenders and of the country itself'', said Soros. Soros also criticised the welfarestate, saying it was no longer a ``viable option'' and could no longer limit the ``growing inequalities between rich countries at the centre and the peripheral countries, and the inequalities within the rich countries themselves''.