Ray Dalio says current bubble is ‘halfway’ to the magnitude of 1929 or 2000

Billionaire investor Ray Dalio — who founded the world’s largest hedge fund, Bridgewater Associates — in a new interview warned that the stock market is a bubble “halfway” to the magnitude of those that triggered historic market crashes like the dot-com bust and the Great Depression.

Speaking with Yahoo Finance, he cautioned that some high-performing stocks have benefited from single-minded speculative trading focused on price, and he attributed recent market volatility to a rotation toward “meat and potatoes” companies that didn’t benefit from pandemic trades as much as some tech firms.

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“What’s happened is that — like a lot of cycles go — a lot of new ideas, new technologies, new things come along, and they make fabulous revolutions,” he says. “And they grow things — and that’s great.”

“But there’s a tendency of investors to extrapolate the past and not pay too much attention to price, and when that happens you start to emerge as somewhat of a bubble,” adds Dalio, the co-chairman and co-chief investment officer of Bridgewater Associates, which holds about $150 billion assets under management.

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“By our measures, the bubble is not what it was in 2000 and not what it was in 1929,” he says. “But it’s kind of like halfway there.”



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