Iconic investor Ray Dalio is warning that US President Donald Trump’s tariff insurance policies could trigger a worldwide financial slowdown.
In a brand new interview on CNBC, the Bridgewater Associates founder says he has severe considerations that growing tariffs could wreak macroeconomic havoc at a time when the nation faces a number of different challenges.
“I agree with the issue. I’m very involved concerning the answer, the practicality of the answer. In different phrases, I believe that that is going to create not solely the issue, the capital markets downside that I’m speaking about associated to costs going up, prices going up, income taking place and capital downside, however I additionally assume that that is going to create nice sand within the gears of manufacturing worldwide.
On the similar time, I do agree that this interdependency, this difficulty of productiveness on the planet wherein we now have to be aggressive and productive, and we’re not aggressive in producing issues is a longer-term downside, not a straightforward one. And I do anticipate that it’s going to have political penalties. That is the character of the cycle.”
Dalio additionally says the nation wants to handle different systemic challenges, equivalent to decreasing the debt and decreasing authorities spending.
“It’s coming additionally similtaneously we now have a funds difficulty. Now, the funds difficulty is a comparably necessary difficulty. In order we glance forward within the months forward, we now have to get the funds deficit down to three% of gross home product. I fear about that similtaneously that is occurring. These aren’t simple issues to resolve. I’m involved as a result of the larger issues exist, the debt exists. You possibly can’t get across the debt. The overspending exists. You continue to have that. You continue to have that competitiveness difficulty. These have repeated all through historical past. We’re in a interval that’s very very similar to the Nineteen Thirties.”
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