Bridgewater founder Ray Dalio warned that the U.S. government’s rising debt levels could hit U.S. Treasury bonds. He believed investors should move some of their funds to foreign markets.
In a recent interview, Dalio described his broad concerns about the United States, including the debt burden, what he called the risk of civil war, and the possibility of the United States becoming involved in another international conflict, which he warned could prevent Foreign investors buy U.S. bonds.
He said: I am worried about the U.S. national debt. Because the debt level is very high. And high interest rates have exacerbated the debt level.
Dalio said: I am also worried about weak demand leading to oversupply. In particular, international buyers are worried about the U.S. debt situation and possible sanctions.
He added that if the United States imposes sanctions on more countries, it may reduce international demand for U.S. Treasury bonds.
Dalio said investors should consider moving some of their funds abroad because of U.S. debt and the potential impact of further conflict.
He said that the risks faced by the United States are rising. Therefore, it is necessary for investors to diversify geographically.
Dalio added: Countries that earn more than they spend, have good balance sheets, have good internal order, and remain neutral in geopolitical conflicts… look attractive.
He pointed out that India, Singapore, Indonesia, Malaysia, Vietnam and some Gulf countries are potentially attractive investment destinations. He added that gold is also a good diversified investment tool.
Among the risks his research has uncovered is that Dalio believes there is an increasing likelihood of civil war in the United States — a chance he puts at between 35% and 40%.
He said: We are on the edge of a cliff now.
But we don\’t know yet whether we will enter more turbulent times.
The civil war that Dalio envisions is not necessarily one in which people pick up guns and start shooting. Although that is possible.
On the contrary, he sees it as an acceleration of the polarization of American politics in recent decades.
This Civil War would be a war in which people move to different states that are more consistent with what they want. They will not follow the decisions of federal authorities with opposing political beliefs.
He also believes that this year\’s U.S. presidential election is the most important of his lifetime and will determine whether the risks he sees, including the effects of climate change and the wider use of artificial intelligence, spiral out of control.
Dalio warns of risk of US civil war: It doesn’t have to be a war with guns
Bridgewater founder Ray Dalio warned that the U.S. government’s rising debt levels could hit U.S. Treasury bonds, and he believed investors should move some funds to foreign markets
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May 16, 2024 4:58 pm