Ray Dalio sees dollar crisis about two years away

[Joe King]

These two quotes are from a few years ago.

Sounds like the IMF is full of doom and gloomers...



More: http://gata.org/node/19528

Yes I saw this.
It raises the question as to why preach doom now ?

In order to hopefully get our idiot gov to correct its course. If ya wait until there is a crisis on the doorstep it's suddenly too late to correct course.
Also, when we're talking a nearly 250 year old system entering end game, does it really matter if someone's warning comes at the two year mark, five year mark, or ten or twenty. In the grand scheme of things, all of those time frames will be right at the end, if you were to graph it out.

The difference is, that some people have better and earlier foresight than others do.

Where some can take a quick educated look at a situation and see impending doom, most others are still just going along fat dumb and happy.

Imho, anyone should be able to understand easily where an inflationary monetary system inevitably leads, but the vast majority haven't a clue about stuff like that.

Case in point, one of the top economic advisors to the bidet hasn't a clue as to how bonds and gov debt work.
I could run circles around this guy on the topic, as could most (if not all) of everyone else on this forum.
...oh, and he admits that MMT is their policy.
Short, less than two minutes. Just might be the scariest vid you've seen in awhile.

Well we are at the two year mark from Ray Dalio's original dollar crisis prediction. The dollar is facing challenges, but I'm not sure we are at crisis yet.

Again, the point is to do something before there's a crisis.
.....and that means making changes when to most, nothing seems wrong to have to make changes, so they say why change anything?

It'd be like driving cross country on bald tires, and thinking you'll take care of them as they blow out. Ie: when the crisis comes. Well that's what our gov is doing. Except our road trip started around a hundred years ago, and the tires are getting bald.

 

[pmbug]

@Joe King - I agree with your point on the reason for sounding alarms. It totally makes sense coming from a high profile individual such as Ray Dalio. My comment - the first quote in your post - was from ~5 years ago (before Covid) and was addressing the point that the doomer rhetoric was coming from the IMF which is largely an organ of the Fed/US Treasury/US Gov. They have historically provided sober analysis of 3rd world countries' fiscal/monetary situations ("you're fucked and need our help"), but not so much on the USA.

 

[Joe King]

@Joe King - I agree with your point on the reason for sounding alarms. It totally makes sense coming from a high profile individual such as Ray Dalio. My comment - the first quote in your post - was from ~5 years ago (before Covid) and was addressing the point that the doomer rhetoric was coming from the IMF which is largely an organ of the Fed/US Treasury/US Gov. They have historically provided sober analysis of 3rd world countries' fiscal/monetary situations ("you're fucked and need our help"), but not so much on the USA.

They are still doing it. It's because even they can see the writing on the wall.

 

[pmbug]

Not Ray Dalio, but an echo of what he has been saying:

 

[pmbug]

Diversification is even more important to investors’ returns than making the right decisions, and gold is a key diversifier, according to Ray Dalio, the billionaire founder of Bridgewater Associates.

In a remote video speech to the Greenwich Economic Forum in Hong Kong on Wednesday, Dalio went through some of what he considered the most pressing economic and geopolitical threats on the horizon.
...
Turning to the topic of asset classes, Dalio said he prefers equity assets over debt, as he worried about the latter failing to provide adequate returns. Central banks own a lot of debt and are currently sitting on losses that they may have to monetize, which he called a classic late-cycle inflationary consequence.

Dalio also insisted that gold should be in every investor’s portfolio, as it is the third-largest reserve currency, trailing only the U.S. dollar and the euro.

“The power of diversification is greater than the power of even good decision-making,” he said.

Speaking on the Finimize podcast on June 1, Dalio expanded on his position relating to gold, saying that it plays a key role in his approach to risk, particularly when too much money is betting on continued gains in equities.

“If you're going to diversify, I suspect that most of your investors have probably a disproportionate amount of investment being long in the stock market,” he told host Gilberto Santos. “You know, always being on one side of the market, and always being in one market, is a risky thing. I would have a bit of gold.”

“A bit of gold is something that is a very effective diversifier,” he continued, “so actually adding gold to the portfolio raises its expected return without depending on the particular assets held in the portfolio, but it diversifies. It's almost a bit of an insurance policy.”

Gold is insurance against the risks of 2024, including U.S. election strife, China trade conflict, debt spiral – Ray Dalio

The Kitco News Team brings you the latest news, videos, analysis and opinions regarding Precious Metals, Crypto, Mining, World Markets and Global Economy.

www.kitco.com

 

[nickndfl]

It's not the dollar as much as it's government bonds from USA and UK. They are worth anything once the music stops.

 

[Joe King]

It's not the dollar as much as it's government bonds from USA and UK. They are worth anything once the music stops.

They're technically the same thing, with the difference being that a US bond for a dollar is a dollar that pays interest, while a dollar in cash does not.

 

[Casey Jones]

They're technically the same thing, with the difference being that a US bond for a dollar is a dollar that pays interest, while a dollar in cash does not.

The bond doesn't pay interest. The bond ISSUER pays the interest.

Does it pay the interest if it is in default?

If the dollar collapses from CTRL+PRNT, will the interest it pays, be worth anything?

 

[Joe King]

The bond doesn't pay interest. The bond ISSUER pays the interest

To the holder, it's the same as holding a dollar that pays them interest.

If you buy a bond for $1 at 5% interest, at the end of the year you'll have your dollar plus five cents.

Had you simply held the dollar itself for that same year, all you'll have is the same $1 bill. Minus any loss in purchasing power. Which you also have with a bond, but the interest helps make up for it a bit.

Does it pay the interest if it is in default

We'll have to cross that bridge when it happens. Until then, a $1 bond is like holding $1 bill that pays interest.

I'm just explaining how it's looked at. Treasuries are viewed as cash.

If the dollar collapses from CTRL+PRNT, will the interest it pays, be worth anything

Well yea, but that hasn't exactly happened yet, has it?

I'm with you on the likely future prospects of the $, but if you know when it's gonna happen, it'd really help.
My gut says sooner as opposed to later, but those are relative terms.
....and therein lies the problem. The writing can be seen on the wall. It's been on the wall for decades. It's baked into the cake that there's a cliff comin'. It's figuring out when it is coming, that is the problem.

Also, suppose that everyone sees said wall with writing on it and acts immediately to extract themselves from what they now see as a failed system, that action itself would cause systemic failure.
.....but at that point it wouldn't have had to happen yet.

 

[Viking]

 

[SilverSamurai]

Big boys shitting pants
Volatility rises
Gold protects the wise

 

[WinkWink]

 

[pmbug]

This is apparently from 2022. I must have missed it when it initially aired (or was published):

 

[nickndfl]

There will come a time when Treasuries are not as liquid as they are now. The FED is one of the main buyers. What happens when they go down with the other banks?

 

[pmbug]

A postelection America worries U.S. billionaire Ray Dalio, who called for reforms numerous times amid a political landscape rife with what he views as irreconcilable differences between both Democratic and Republican parties.

Speaking at the Future Investment Initiative conference in Saudi Arabia on Wednesday, the founder of the investment firm Bridgewater Associates spoke about major geopolitical and election-related concerns, the issue of rising U.S. deficit and how investors can best position their portfolios.

“Both of the candidates worry me,” Dalio told CNBC. “This left, right and fighting each other is a problem as it becomes more of the extremes. I think there needs to be a bringing of Americans together, that middle of that, and making great reforms. … There needs to be a strong leader of the middle, I believe, that makes great reforms. … Neither of the candidates does that for me.”
...
“We have a real debt problem. … I think one man’s debts is another man’s assets,” Dalio said. “Treasury market is basis of all capital formation. At some point, when you combine it with the internal conflict issue, if you have a downturn — when the downturn comes — I’m worried about internal political and social conflict.”

When positioning one’s portfolio, the famed investor said gold should be part of a diversified and balanced strategy that reduces overall risk.

https://www.cnbc.com/2024/10/30/ray-dalio-is-concerned-about-america-post-election-both-candidates-worry-me.html