Latest news with #BridgewaterAssociates
Mint
a day ago
- Business
- Mint
7 key lessons from Ray Dalio's ‘Principles for Dealing with the Changing World Order'
Ray Dalio's iconic book, 'Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail', was first published in November 2021, it is a powerful tool for exploration and understanding of how global empires rise, reach their peaks, and then fall over time. The book draws on over 500 years of research and data to identify repeating patterns in history. It tries to elucidate on what historical events mean for today's turbulent world of equity markets. Ray Dalio focuses on presenting a 'Big Cycle' framework that helps readers clearly understand the currently ongoing geo-political landscape, particularly the growing rivalry between the United States of America and China. Combining historical analysis, economic theory along with personal investment thesis, the book provides both a stern warning and a sensible guide for navigating uncertain times. Ray Dalio is the founder of Bridgewater Associates, one of the largest and most reputed hedge funds in the world. Admired for his analytical approach to economics and his sincere commitment towards economic transparency, Dalio has devoted decades to study markets, geo-politics and human psychology. With this book he focuses on global sustainability, offering a prudent framework to deal with economic changes when we have a transition time of shifting tides of global power for a leading super power i.e., the US to an upcoming super power China. Here are seven key lessons from this influential work: Dalio believes that nations follow a common path i.e., a path that emerges through strong leadership and innovation, rising through economic and military might and then eventually declines under the weight of compounding debt and internal strife. 'The times ahead will be radically different from those we've experienced in our lifetimes, though similar to many times in history,' he writes. One of Ray Dalio's core ideas is that long term debt cycles, especially when combined with money printing, often precede national decline. As money printing is nothing but adding more national debt on any nation's economy. 'Debt is a double-edged sword that fuels economic growth in good times and destruction in bad times,' he explains. Ray elaborates on the crucial role of human capital in national development, economic growth and progress. He believes that education and innovation cumulatively provide strength to a civilisation and help in building powerful empires. 'The most powerful empires were those that achieved high levels of education, civility, and competitiveness,' he notes, linking societal progress, holistic development of the larger community with long-term prosperity. Rising disputes and inequalities in a nation, political polarisation and cultural fragmentation are serious red flags. Such differences weaken the core of a country and make future investments and growth difficult. 'When the causes that people are behind are more important to them than the system, the system is in jeopardy,' Dalio further warns, highlighting growing divisions in the US and other major democracies are signs of long term structural weakness. Therefore, for economic prosperity, investments and growth it is crucial for the nation to gel as one and join hands to work together in achieving sustainable long term goals. A nation's influence is backed not just by its economic power but also by its military might. Trade dominance, reserve currency status often correlate with strong and rigid defence capabilities. These elements holistically join to reinforce a nation's global leadership. Since 1945 i.e., the end of the second world war, the US has been the leader of global trade and world order, but now China is also only the podium according to Dalio and is challenging the US. Dalio considers China's resurgence not a chance or a fluke, but as a natural part of historical power shift. 'The United States and China are now in the classic late stages of the big cycle where a rising power challenges an incumbent one,' he writes, stressing that the currently ongoing geopolitical tensions are part of a much larger historical trend. The final point to take note of for individual investors is to focus on adaptability. Dalio recommends preparing for difficult and volatile times ahead by diversifying investments, having a long term vision and continuous learning. 'If you worry, you don't have to worry. If you don't worry, you need to worry,' he quips, stressing the value of proactive thinking in unpredictable environments. Therefore, Dalio's latest book is more than just a lesson in history and economics, it is in fact a blueprint for the global economy. By studying the past he suggests we can be better prepared for what lies ahead economically, politically and even personally. Disclaimer: This article is for educational and informational purposes only and should not be considered investment advice. Readers are encouraged to consult a licensed financial advisor before making any investment decisions.
Yahoo
3 days ago
- Business
- Yahoo
Investor Who Predicted 2008 Crash Sounds Alarm On 1 Particular Donald Trump Policy
Hedge-fund billionaire Ray Dalio — who correctly predicted the financial crash that roiled the world in 2008 — has warned in his new book that America's current $36 trillion debt is the country's biggest problem. And Dalio slammed Donald Trump's administration for slashing federal spending and gutting the government because 'many people who will be hurt by them will fight back and valuable support systems will be weakened or eliminated,' according to quotes of 'How Countries Go Broke: The Big Cycle' that The Guardian published Tuesday. Dalio, the founder of global hedge fund Bridgewater Associates, also suggested Trump's 'Make America Great Again' policies are 'remarkably like the policies that those of the hard-right countries in the 1930s used.' 'It would be fair to argue that his attempts to maximize the power of the presidency by bypassing the other branches of government are analogous to the ways that Andrew Jackson (of the right) and Franklin D Roosevelt (of the left) did, though he is even more aggressive than they were,' he added. 'We will see how far he will take it.' Dalio last month warned how 'something worse than a recession' could soon happen, attributing it to a raft of issues including Trump's tariffs on products imported from other countries. 'We have a breaking down of the monetary order,' Dalio cautioned on NBC's 'Meet The Press.' 'Such times are very much like the 1930s,' he added. 'I've studied history, and this repeats over and over again.' Harvard's Laurence Tribe Delivers Unflinching Message To Foreign Students In Trump Crosshairs Fox News' Brit Hume Scoffs At Trump's Latest Rant: 'Don't Know What' He's Talking About Wall Street Journal Shatters Core Trump Fantasy In Editorial Urging GOP 'Revolt' Rage Against The Machine's Tom Morello Unleashes Anti-Trump Fury With Flip Of His Guitar
Bloomberg
4 days ago
- Business
- Bloomberg
Dalio Won't Join Indonesia Fund as Adviser in Blow to Prabowo
Ray Dalio won't be an adviser to Indonesia's new sovereign wealth fund Danantara, people familiar with the matter said, just two months after officials announced the billionaire's involvement. The founder of Bridgewater Associates opted not to be on Danantara's advisory board even as the fund publicly touted his appointment along with four other prominent business and political leaders in March, said the people, asking not to be identified discussing a private matter. The reason wasn't immediately clear.
The Guardian
4 days ago
- Business
- The Guardian
Trump is ‘remarkably like' 1930s far-right fascists, billionaire investor warns
Donald Trump wants to 'dictate' policies like those of far-right regimes in the 1930s, a leading billionaire investor has warned. Ray Dalio writes in a new book that the US president is acting like a chief executive without a board as he seeks to expand executive power even more aggressively than predecessors Andrew Jackson and Franklin D Roosevelt. Dalio, 75, is the founder of investment firm Bridgewater Associates, one of the world's biggest hedge funds, and a rare critic of the system that generated his wealth. His book How Countries Go Broke: The Big Cycle addresses the national debt and Trump's attacks on democratic norms. The Guardian obtained a copy. Invoking a decade when fascists such as Adolf Hitler of Germany and Benito Mussolini of Italy were in power, Dalio writes: 'When I say that the policies President Trump is using to 'make America great again' are remarkably like the policies that those of the hard-right countries in the 1930s used, that should not be controversial.' He continues: 'It would be fair to argue that his attempts to maximise the power of the presidency by bypassing the other branches of government are analogous to the ways that Andrew Jackson (of the right) and Franklin D Roosevelt (of the left) did, though he is even more aggressive than they were. We will see how far he will take it.' In times of conflict, Dalio notes, aggressive leaders work to eliminate the opposition, make changes to the law to assume special powers and seize control of the media to produce pro-government propaganda. If conflicts become severe, new laws and punishments target the opposition. Since returning to office in January, Trump has signed a record 152 executive orders, concentrating power and sidelining Congress. He has defied court orders and detained or deported immigrants without due process. He has sought to reward law firms, media companies and universities that bend to his will and punish those that defy him. 'Is Donald Trump a demagogue?' Dalio asks, describing a demagogue as a political leader who gains power by appealing to people's emotions, fears, prejudices and desires, typically stirring up populist sentiment and promising easy solutions to complex problems. 'The question is what will the controls be and how far will Trump push things? Unlike for a CEO, there is no board for the US president. Are there effective regulators in place? If so, it is not clear to me who they are.' Trump's strongman style is a symptom of America's polarised politics, the author argues. 'Donald Trump wants to dictate policies rather than have a classic 'let's work together across party lines' approach to governing. This confrontational approach is an extension of how great internal political conflict has become in recent decades.' Dalio grew up in a middle-class neighborhood on New York's Long Island. He began investing at the age of 12 when caddying at a local golf course. He went to Harvard Business School, had short stints at two Wall Street firms and started Bridgewater in 1975 from a two-bedroom apartment in New York. It went on to become the largest hedge fund in the world. In How Countries Go Broke, Dalio identifies the government's debt – currently more than $36tn – as the US's most serious problem, outlines what he calls the 'Big Debt Cycle' and offers advice on how people can protect themselves from the fallout. The businessman, who correctly predicted the 2008 financial crisis, condemns the Trump administration's cost-cutting measures as likely to have negative consequences because 'many people who will be hurt by them will fight back and valuable support systems will be weakened or eliminated'. He adds that his own wife works to help low-income students in deprived neighbourhoods who suffer from inadequate nutrition. The cancellation of school lunch programmes on which they depend 'will have terrible second-order consequences'. Trump's policies are aimed at moving more money, power and freedom into the hands of the most productive people, Dalio adds. 'It's not easy to manage and improve a country that has been mismanaged and in such a mess while also keeping people happy at a time when democracy is fracturing. I recommend regularly checking on how those in the bottom 60% are doing and feeling.'
CNBC
22-05-2025
- Business
- CNBC
Ray Dalio says to fear the bond market as deficit becomes critical
Billionaire investor Ray Dalio on Thursday sounded another alarm on soaring U.S. debt and deficits, saying it should make investors fearful of the government bond market. "I think we should be afraid of the bond market," Dalio said at an event for the Paley Media Council in New York. "It's like ... I'm a doctor, and I'm looking at the patient, and I've said, you're having this accumulation, and I can tell you that this is very, very serious, and I can't tell you the exact time. I would say that if we're really looking over the next three years, to give or take a year or two, that we're in that type of a critical, critical situation." The founder of Bridgewater Associates, one of the world's largest hedge funds, has warned about the ballooning U.S. deficit for years. Recently, investors have begun demanding lower prices to buy the bonds that cover the government's massive budget deficits, pushing up yields on the debt. Rising worries about the fiscal situation last week triggered a high-profile credit rating downgrade from Moody's. The yield on the 30-year Treasury yield on Thursday traded at levels not seen since 2023, around 5.14%. Rising financing costs along with continued spending growth and declining tax receipts have combined to send deficits spiraling, pushing the national debt past the $36 trillion mark. In 2024, the government spent more on interest payments than any other outlay other than Social Security, defense and health care. "We will have a deficit of about 6.5% of GDP — that that is more than the market can bear," Dalio said. Dalio said he's not hopeful politicians would be able to reconcile their differences and lessen the country's debt load. In a party line vote early Thursday, House members approved legilsation that lowers taxes and adds military spending. The bill — which now goes to the Senate — could increase the U.S. government's debt by trillions and widen the deficit at a time when fears of a flare-up in inflation due higher tariffs are already weighing on bond prices and boosting yields. "I'm not optimistic. I have to be realistic," Dalio said. "I think it's the essence of the challenge of our country that anything related to bipartisanship and getting over political hurdles ... essentially means 'give me more,' which leads to these deficits."
