Billionaire hedge fund manager Ray Dalio is revealing and breaking down his latest economic concerns – especially when it comes to China and America’s deficit – in a new Fox News interview.
Speaking with Brian Kilmeade on “Fox & Friends” Wednesday, Dalio warned China won’t give up its competition anytime soon.
“They’re also making technology and improving at a fast rate. So you cannot take China and think that they are not going to be a force for the foreseeable future. They’re not folding, okay?” Dalio said.
“We both have our challenges and there’s going to be a big conflict. That’s the nature of the beast.”
BILLIONAIRE HEDGE FUND MANAGER WARNS TARIFFS COULD TRIGGER CONDITIONS ‘WORSE THAN A RECESSION’
The Bridgewater Associates founder reacted to a recent report from the Washington Post, which signaled that Beijing issued new spending guidelines for Chinese government officials, urging them to pursue “a frugal life” with looming economic headwinds.
China and President Donald Trump recently reached new trade agreements, with both countries reducing tariffs on each other’s goods by 115%. Trump’s restructuring of global trade relationships is something that has “got to happen,” according to Dalio.
“It’s gotta happen for a couple of reasons. First of all, it’s one of the reasons we’re also getting into a lot of debt, but partially it could also contribute to tax revenues,” he explained.
“These imbalances are not sustainable,” Dalio continued. “They’re not sustainable not only because of the debt issue and the trade issue to make it more competitive, but you also have a situation of security. How can you be dependent on imports from China? We’ve come to a world now in which there must be much more self-sufficiency.”
Dalio also raised concerns about America’s rising deficit, adding that he’s “worried” about the U.S. dollar’s status as the world’s reserve currency.
“When there’s a lot of debt, it has to be sold, and there is not enough buyers for that debt,” the billionaire cautioned. “And when that happens, bad things happen, like interest rates go up and the economy goes down.”
Confirming he’s been investing in gold and cryptocurrency, Dalio admitted: “Money has to be a medium of exchange and a [storeholder] of wealth. And I think because we have a debt problem… then you have to look at the alternative monies.”
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