Dalio Warns: A Bond ‘Blow-Off’ as a Repeat of the Late 1930s Looms

via CNBC:

  • Hedge fund kingpin Ray Dalio is warning that current conditions remind him of the Depression-era environment.
  • He cited three factors: Ineffective central banks, high levels of debt and the U.S.-China conflict.
  • Dalio previously predicted a “paradigm shift” that would benefit gold.
  • His biggest funds are losing money this year.

Hedge fund titan Ray Dalio is worried that the current landscape is starting to resemble Depression-era conditions that could hammer investors.

In a LinkedIn post Thursday, the billionaire Bridgewater Associates founder said high levels of debt and central banks’ ineffectiveness are two of the key factors that need watching. The U.S.-China conflict is adding to the problems as an existing power battles an emerging one.

“If/when there is an economic downturn, that will produce serious problems in ways that are analogous to the ways that the confluence of those three influences produced serious problems in the late 1930s,” Dalio wrote.


U.S. Government Bonds on Track for Strongest Return Since 2008 Crisis

U.S. Treasury index has gained 3.33%, more than in any month since December 2008.


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