Bridgewater Associates founder Ray Dalio voiced his concerns about the future of the U.S. economy in an NBC interview. He warns of potential catastrophes that may be even more serious than the expected recession.
Greater Threats than Recession
In the interview, Dalio noted that the U.S. is at a decision-making point and is approaching a recession. However, he expresses concern about 'something worse than a recession.' According to Dalio, the growing government debt, internal political conflicts, and external threats such as natural disasters and technological changes impact economic stability. Dalio predicts that without budget regulation, the system of government debt might collapse, leading to a crisis comparable to the Great Depression.
Tariffs are just a symptom
Dalio asserts that tariffs on imports are merely a symptom of a deeper issue related to high levels of government debt. He urges the recognition that the old economic system is unstable, and new strategies must be developed. 'The old monetary system must change, and it's up to the government to decide how it will happen: the easy way or the hard way,' noted Dalio.
What can save the U.S. economy?
Dalio proposes a solution to prevent the looming economic crisis: the U.S. needs to reduce its budget deficit to 3%. He also shared thoughts on cryptocurrency, noting that while he includes it in his portfolio, Bitcoin does not seem to him as a universal safe haven. According to Dalio, Bitcoin cannot be a reserve currency due to its volatility and transactional transparency.
Ray Dalio emphasizes the need for urgent measures to prevent a potential economic catastrophe in the U.S. His forecasts raise concerns and stress the importance of effective management of public finances.
