Dalio, the billionaire founder of hedge fund giant Bridgewater Associates, warned that the U.S. government’s rising debt levels may affect U.S. national debt. He believes that U.S. investors should transfer some of their funds to foreign markets.
In the interview, Dalio described a wide range of concerns about the United States, including its debt burden, the risk of what he called a civil war, and the possibility of the country becoming embroiled in another international conflict, which he warned could would prevent foreign investors from buying U.S. bonds.
I\’m concerned about the U.S. Treasury debt. Because debt levels are high. And high interest rates are exacerbating debt levels.
Dalio said: I am also concerned about weak market demand for U.S. debt, especially from international buyers who are worried about the U.S. debt situation and possible sanctions.
He added that if the United States imposes sanctions on more countries, then this may reduce international demand for U.S. Treasury bonds.
Dalio\’s warning comes as some commentators grow increasingly concerned about the nation\’s debt pile.
The U.S. Congressional Budget Office (CBO) predicts that by the end of this decade, the U.S. debt-to-GDP ratio will exceed the high of 106% during World War II and will continue to rise.
The head of the watchdog has warned that if the federal deficit is ignored, there could be a market shock like that of former British Prime Minister Truss.
Federal Reserve Chairman Powell also said in an interview earlier this year that the United States is on an unsustainable fiscal path.
At the same time, U.S. Treasury yields have risen this year. Earlier, as investors sharply lowered their expectations for interest rate cuts, the 10-year U.S. Treasury yield jumped from 3.88% to 4.35%. But after the release of CPI data on Wednesday. Bond yields have fallen.
Some investors believe such concerns are exaggerated.
They believe that the large amount of new U.S. debt issued this year has been basically well absorbed by private investors. So far, larger U.S. debt auctions have had little impact on yields.
Because of U.S. debt and the potential impact of further conflict, Dalio believes investors should look to move some of their money abroad.
He said that the risks facing the United States are rising and diversifying investments is necessary.
\”A country that earns more than it spends, has a good balance sheet, has internal order, remains neutral in geopolitical conflicts… looks attractive,\” he said.
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 diversification tool.
Dalio, 74, will resign as chairman of Bridgewater Associates in 2021.
Bridgewater Associates is the world\’s largest hedge fund, with $112.5 billion in assets under management. Currently, he remains an advisor to Bridgewater\’s three co-chief investment officers and is also a member of the board of directors. His research is supported by a team at Bridgewater and works with Bridgewater Associates. Investors share.
Dalio believes that one of the risks his research has identified is the increasing likelihood of a civil war in the United States – a probability that he puts at between 35% and 40%.
We are now on the brink of collapse. But we don\’t know yet whether we will enter more turbulent times.
However, the civil war imagined by Dalio is not necessarily a war. Although this situation is possible.
Instead, he sees it as an acceleration of the polarization of American politics in recent decades.
This civil war will be people moving to different states that are more aligned with their wishes. They will not listen to the decisions of federal authorities with opposing political beliefs.
He also believes that this year\’s U.S. presidential election, the most important of his lifetime, will determine whether the risks he sees, including the impacts of climate change and the wider use of artificial intelligence, will spiral out of control.
Dalio said he refused to support any presidential candidate, but revealed that he recently attended Taylor\’s concert.
He joked: \”I saw how she brought people of different nationalities together.
I say this partly as a joke, but if she ran for president and was willing to listen to good advisers, I would consider supporting her.
Dalio, the founder of Bridgewater Associates, warned again: There is going to be a problem in the United States!
Billionaire Dalio, the founder of hedge fund giant Bridgewater Associates, warned that the U.S. government’s rising debt levels could affect U.S. national debt, arguing that U.S. investors should move some of their funds to foreign markets.
Like (0)
Dalio warns of risk of US civil war: It doesn’t have to be a war with guns
Previous
May 16, 2024 4:58 pm
Artemis Medicare Services raises ₹330 crore from IFC; stock gains over 2%
Next
May 16, 2024 11:19 pm