Is that it? Is it over? Is the economic crisis that plagued the world, the crisis that George Soros predicted would be the worst in 60 years, really now done? Can banks go back to paying bonuses in the tens of millions of dollars? Can regulators settle back to their long lunches? Will commodities soar again?

Like all good answers, it is yes and no. Certainly, the crisis has eased, and certainly it has eased faster than anyone anticipated, but the mood is edgy and cautious with plenty of doomsday predictions still out there.
Soros’ forecast of gloom and horror – not uncommon for hedge fund managers and goldbugs – certainly seems at this point to have been overblown. But if you go back to what he originally said, it’s much more obvious that his analysis was not confined to the overall movement of the markets and gloomy comparisons with 1929, but much more interested in the precise character of the crisis.

In a pivotal piece in the Financial Times, Soros wrote: “The salient feature of the current financial crisis is that it was not caused by some external shock like OPEC raising the price of oil or a particular country or financial institution defaulting

“The crisis was generated by the financial system itself. This fact — that the defect was inherent in the system — contradicts the prevailing theory, which holds that financial markets tend toward equilibrium and that deviations from the equilibrium either occur in a random manner or are caused by some sudden external event to which markets have difficulty adjusting.”

This is the question that is now in question. Is it in fact an “obvious misconception” that people can be trusted to pursue their own self-interest?

The fact is that the crisis might not seem to have changed anything, yet it has changed many things. The dollar as reserve currency is now in question. Bank regulation is going to be much tighter going forward. The interplay between nations has shifted dramatically. For the rest, the bulls are back, but they are much-chastened bulls.

The Wall Street Journal reports: “People don’t believe it. They don’t trust it. They are nervous. They are anxious,” said Andy Brooks, head of stock trading at money-management group, T. Rowe Price. “Most of us can’t believe the year we have just been through, where you made and lost so much money.”

By Tim Cohen

Read more: The Wall Street Journal