American hedge fund manager and prominent investor Ray Dalio is trying to get people to put their money into gold and Bitcoin again by warning them against debt assets, even while major economies are increasingly indebted.
Dalio Backs Bitcoin and Gold Amid Debt Worries
The South China Morning Post carried Dalio’s comments at Tuesday’s Abu Dhabi banking conference. In that section, he expressed his belief that a “pending debt money problem” is imminent and his desire to “steer away from debt assets like bonds and debt, and have some hard money like gold and Bitcoin.”
The limited amount of 21 million Bitcoins (the “digital gold” moniker) makes it similar to the scarcity of physical gold. Because of its scarcity, it can also improve over the long run, which is an effect of fiat currencies. On the other hand, the stability of gold made it a popular asset to own during economic uncertainty.
Dalio Warns of Debt Crisis and Global Risks
If reports are to be believed, the founder of Bridgewater Associates has claimed that major nations are facing historic increases in debt, including the United States, China, and practically every other large country save Germany. In his opinion, if this unsustainable tendency is not effectively managed, it could cause significant economic consequences. Dalio predicted that several nations would face a debt crisis in the coming years, which would cause a significant decrease in the value of their currency.
Ray Dalio named “debt, money, and the economy” one of five major factors influencing global events. Aside from internal political divisions caused by differences in income and values, he cited foreign geopolitical conflicts like the power struggle between the United States and China as elements of crucial importance.
Dalio Favors Gold, Warns Against Cash
In the past, Dalio has expressed a liking for Bitcoin and gold. Gold, though, would be his choice if pressed. In an earlier interview with CNBC, he stated, “If you put a gun to my head, and you said, ‘I can only have one,’ I would choose gold.” He confessed to owning “a very small amount of Bitcoin.” Since Bitcoin can’t buy much, Dalio has already argued that it fails as a medium of exchange. Additional government prohibition was his warning.
Furthermore, Dalio stated that “cash is trash” and suggested that people should borrow money instead of keeping fiat currency. He advocated a different approach, prioritizing “higher-returning, non-debt assets” investments.
Summary
In light of growing global debt and economic uncertainty, Bridgewater Associates founder Ray Dalio has urged investors to prioritize Bitcoin and gold as protections. He foretells monetary devaluation and economic upheaval due to a debt crisis that would soon impact major economies. Although Dalio values Bitcoin for its rarity, he prefers gold due to its steadiness in times of unpredictability. He calls cash “trash” and says that to survive the current economic climate, people should put their money into non-debt assets that yield more money.
FAQs
What is Ray Dalio's stance on debt assets?
Dalio warns against investing in debt assets like bonds, predicting a looming debt crisis that will devalue currencies and impact global economies.
Why does Dalio prefer gold over Bitcoin?
While he acknowledges Bitcoin's scarcity, Dalio values gold more for its stability and history as a haven during economic uncertainty.
What is Dalio's view on cash?
Dalio refers to cash as "trash," suggesting that holding fiat currency in today's economy is not a smart investment choice.
What impact does Dalio predict from global debt?
Dalio foresees a debt crisis leading to economic upheaval, which could cause significant currency devaluation in major economies.
