Dubai, United Arab Emirates – Hedge fund Titan Ray Dalio has issued a new warning to the U.S. economy to warn of dire consequences if the Trump administration does not cut the country’s debt.
“Like I’m a doctor, I’m talking to you about your condition, it’s very, very serious. All of these are the main problems,” Dalio told CNBC’s Dan Murphy at the World Government Summit. . “What you need to do is reduce your deficit from seven and a half of GDP to 3% of GDP, you can do it. There are things you can do to cut it into ‘LL’ to make it more Health, so the real problem is a political issue.”
this Total U.S. debt As of February 11, as of February 11, it stood about $36.22 trillion Public debts held at $28.8 trillion In the form of securities owned by individuals, companies, state or local governments, the Federal Reserve, foreign governments, and other entities other than the U.S. government.
High debt means that governments spend more on interest payments and are more economically vulnerable in the event of future economic crises. It also leads to higher inflation and burdens future generations.
“I want to remind people. I want to remind government officials,” said the founder of the billionaire Bridgewater employee. “I want to help, you know, so I feel like a doctor, and then I’ll say all politically Everyone…if this doesn’t happen, we have the equivalent of an economic heart attack or a heart attack in the bond market, and then you know who is responsible, because that can happen.”
“So it needs the same discipline as I said to you, well, you need to change the way you eat, you need to change the exercise routine, you need to do these things.”
Dalio stressed that the government is responsible and leaders should commit to reducing the U.S. budget deficit from 7.5% of its GDP to 3% or resign.
When asked what his message was about the Trump administration, Dalio replied:
“I think they recognize this problem and then in the actions they take, how do they cut costs? How do you increase productivity? … Make sure you really know what you are doing and you are practical and doing it in…conservative On the one hand, because you know, we’re going to see how many cuts we’re going to see, and what are the consequences of the cuts.
Dalio also warned of debt in private credit, saying that “the debt death spiral is that part of the cycle, and the debtor needs to borrow money to pay the debt service, then accelerate the debt, and then everyone sees it, they don’t like debt. Hold debt.”
Bridgewater Associates of Dalio is one of the largest hedge funds in the world. As of September 2023, it had $171.7 billion in assets, according to the Securities and Exchange Commission.
