Investor who called 2008 crash delivers grim warning to the US
'If the US doesn't cut the deficit to 3 percent of the GDP, and soon, we risk facing an economic heart attack in the next three years,' Dalio wrote on X. 'The good news is that these cuts are possible.' The national debt is nearing $37 trillion — equal to 99 percent of GDP — and the Congressional Budget Office projects it could hit 150 percent by 2055.
Dalio, founder of Bridgewater Associates — the world's biggest hedge fund — said a 4 percent adjustment to spending and tax revenues could stabilize the economy and even lower interest rates. 'We know this kind of balance is possible because it happened between 1991 and 1998,' he wrote, pointing to previous bipartisan deficit deals.
'My fear is that we will probably not make these needed cuts due to political reasons, and will have even more debt and debt service encroaching on our spending that will ultimately lead to a serious supply-demand problem.' Dalio has repeatedly warned that economic decisions made by the White House will end in economic catastrophe.
In April the billionaire spoke against Trump's decision to launch a global trade war via tariffs on America's trading partners. 'Some people believe that the tariff disruptions will settle down as more negotiations happen and greater thought is given to how to structure them to work in a sensible way,' Dalio wrote in a post on social media site X. 'I am now hearing from a large and growing number of people who are having to deal with these issues that it is already too late.'
JPMorgan's CEO Jamie Dimon (pictured) warned last month that the US economy was on shifting 'tectonic plates' and warned that inflation could once again rear its ugly head. 'You have all these really complex, moving tectonic plates around trade, economics, geopolitics, and future factors, which I think are inflationary: military, restructuring of trade, ongoing fiscal deficits,; he told the Morgan Stanley US Financials Conference. The co-founder of Home Depot Ken Lagone also raised concerns about US debt, and said it is a 'scary' indicator for the state of the economy.
The billionaire said he hoped Washington would heed his warning that 'we have to be mindful of the importance of our status in the world economy and the world markets. 'If we fritter that away, we're in trouble,' the 89-year-old said. 'Four weeks ago, we couldn't float a 20-year bond. They were unbiased. That's a dangerous signal. That's the beginning,' Langone said referencing recent crises in the bond market.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Guardian
12 minutes ago
- The Guardian
Millennial women were told to chase our dreams. That's left us burnt out, broke and dreaming of a rich patron
A couple of weeks ago, I came across an Amy Poehler joke in which she sums up the different generational experiences of money: 'Boomers are all about money. Gen X is like: 'Is it all about money?' Millennials ask: 'Where is the money?' And gen Z is like: 'What is money?'' It made me laugh – but it also hit a nerve. It felt painfully accurate and oddly comforting. Maybe it's not just me. I'm a millennial, and financial insecurity has been a theme in my life for a while. But recently, it's grown louder, and I literally can't stop asking: 'WHERE IS THE GODDAMN MONEY?' I used to ask nicely. After all, I was raised to be a grateful, polite millennial – the kind who believed that magic always happens outside your comfort zone and therefore did unpaid internships in her 20s and sent thank-you emails after being underpaid. But no more. Hence the capital letters. I'm raging. Maybe it's because I'm approaching 40. Maybe it's because I keep comparing myself with my parents, who by this age had two kids, a car, a house, a garden and three holidays a year. I'm not just raging. After 15 years of working non-stop, I'm exhausted. And there are days when I ask myself: is it really meant to be this way – or am I just failing? Am I simply not grownup enough when it comes to money? I know the answer isn't that simple – or that harsh. Because usually, after days spent examining my shortcomings, I also think: no, this can't just be personal failure. Maybe the odds were never in my favour. Millennial women like myself were told to work hard and follow our passion. Because if you work hard and find something you're good at, it'll pay off. It doesn't, though. The path I've chosen – creative, independent – offers very little in the way of long-term security and when I look around, a pattern emerges. Over dinner recently with three friends – two men and one woman, all about my age – we started talking about money worries. The woman, a talented sculptor, said she had been feeling deeply anxious. She thought it was partly hormones, but more than that, it was existential. She was considering retraining, maybe going into teaching – anything to build a more stable life. At one point, she turned to me and asked: 'How do you do it?' I said: 'I juggle three things at once.' Meanwhile, the two men nodded sympathetically. They work in the arts – but both have full-time jobs and permanent contracts. One just bought a plot of land. The other has tenure. The women are freelancers. The men are secure. Is it our fault? Couldn't we just do what they did? I don't think so. Our economic system doesn't just undervalue women's work. It depends on it. It relies on our flexibility, our unpaid labour, our creative output, our willingness to 'make it work'. It assumes women will absorb the risk, subsidise culture and care with their own time, energy and savings. In creative industries, this is especially stark: women are expected to be grateful to be there at all. To work 'for exposure', for the opportunity – not the paycheque. And that gratitude has kept us quiet, compliant – and broke. This is no accident – it's systemic. In Germany, women across all age groups earn less, save less and live longer. If you're single and self-employed, you're automatically walking a financial tightrope with no net and you'll likely belong to the 70% of working women today who are at risk of poverty in old age. (Recent data from the German Federal Statistical Office reports that the gender gap in retirement income amounts to 29.9%.) I can't believe I'm saying this out loud, but it feels like the only safety net is a rich spouse. When I told my friend a few days ago that I prefer dating artists, she threw up her hands: 'No! You need to find a hedge fund manager!' I thought of that meme – 'I'm looking for a man in finance' – and rolled my eyes. But she wasn't wrong. A wealthy and steady partner is the most reliable pension plan for many women. I don't want a husband, though. What I secretly long for is a patron. The 18th-century kind. Someone who says: 'I believe in your work. Go write. Don't worry about anything.' Or, more realistically: universal basic income. And a proper educational system for the next generation of women. One that teaches them how to handle money, so they don't fall into the same trap. Seriously: can someone explain to me why we didn't learn about compound interest, mortgages, tax brackets and pensions in school? Isn't financial literacy a basic part of education, if the goal is to raise well-equipped adults? Sign up to This is Europe The most pressing stories and debates for Europeans – from identity to economics to the environment after newsletter promotion I've worked my heart out for more than a decade. I've built a body of work I'm proud of. And yet, I still get nervous opening my banking app. Still avoid deep financial talk. Still don't fully understand the German tax system. I fell for the silly belief that talking about money is obscene. Sometimes I want to slap myself for not having made smarter choices. For not having planned, protected myself by investing or talking to experts. Instead, I kept dreaming about a life filled with interesting encounters, stories, intellectually stimulating conversations. And honestly, there's still a part of me that cherishes that softness. To be a European millennial now – in our late 30s – means witnessing the erosion of the ideals we grew up with, yet still holding on to something tender. Maybe naive. Maybe vital. We were promised a lot and trained for little. And perhaps this vulnerability – this capacity to imagine a different, less materialistic world – is not only a weakness. It might be a strength, of a playful sort. In Istanbul, my current place of residence, people buy gold. I own some gold jewellery – some pieces were gifts, others inherited. I don't like most of them and rarely wear them. But with gold prices soaring, I've been looking at them differently. Gold is finite, after all, which means it keeps its value. Unlike stocks. My plan: take these items to a friend in the Grand Bazaar who deals in gold. There's something almost magical about the idea of turning my few rings and necklaces into gold plaques – a quiet stash I can cash in quickly, to be kept in a velvet pouch that would look like a fairytale treasure chest. A reminder of how much I'm still clinging to a world of fantasy. And maybe that's the whole trick. Keep going. Keep improvising. Because our boomer parents told us to follow our passion. And now? We're melting down our jewellery. Carolin Würfel is a writer, screenwriter and journalist who lives in Berlin and Istanbul. She is the author of Three Women Dreamed of Socialism
Reuters
12 minutes ago
- Reuters
Indian equity benchmarks slip at open as US unleashes fresh tariffs
Aug 1 (Reuters) - Indian benchmarks opened marginally lower on Friday after the United States slapped dozens of trading partners with steep tariffs and reiterated 25% duty on imports from India. The Nifty 50 (.NSEI), opens new tab fell 0.14% to 24,734.9 points and the BSE Sensex (.BSESN), opens new tab lost 0.14% to 81,074.41 as of 9:15 a.m. IST. Twelve of the 16 major sectors declined at the open while the broader smallcaps (.NIFSMCP100), opens new tab and midcaps (.NIFMDCP100), opens new tab traded flat. The benchmark Nifty and Sensex (.BSESN), opens new tab fell as much as 0.9% on Thursday, but pared some losses to end 0.4% lower as investors viewed the United States' 25% tariff on India as a pressure tactic and hoped for lower rates once negotiations conclude. The negotiations between the two countries are continuing, U.S. President Donald Trump said on Wednesday, after announcing tariffs on India. U.S. increased tariffs to 35% from 25% on Canada, a top trading partner, and set duties at 20% for Taiwan and 19% for Thailand. ($1 = 87.5700 Indian rupees)
Reuters
12 minutes ago
- Reuters
Australia eyes more US exports as Trump holds tariffs at 10%
SYDNEY/WELLINGTON, Aug 1 (Reuters) - Australian products could become more competitive in the U.S. market, helping businesses boost exports, Trade Minister Don Farrell said on Friday, after U.S. President Donald Trump kept the minimum tariff rate of 10% for Australia. Trump set higher import duties of 10% to 41% starting in seven days for 69 trading partners including a 35% duty on many goods from Canada, 50% for Brazil and 15% for Australia's south Pacific neighbour New Zealand. "What this decision means in conjunction with all of the other changes to other countries is that Australian products are now more competitive into the American market," Farrell told reporters in Adelaide. "We will assist all of our exporters in ensuring we take advantage of this situation and increase the volume of exports." New Zealand Trade Minister Todd McClay said he was hoping to have talks with his U.S. counterparts. "The first step will be to talk to them directly. And we've engaged in a lot. In fact, it's been very good engagement," he told Radio New Zealand. Trump's decision to put Australia among countries facing the lowest tariff levels will be a relief for Prime Minister Anthony Albanese after the opposition criticised him for not meeting the U.S. president in person. But Farrell said Australia's negotiations helped it to retain the baseline tariff rate. "This is a vindication for the Albanese government and particularly the prime minister in the cool and calm way we have conducted diplomacy with the United States," Farrell said. Australia last week eased restrictions on beef imports from the United States, potentially smoothing trade talks with Trump, although Albanese said the decision had long been considered and was not related to any trade negotiations.
