A famed financial titan predicts that President Donald Trump’s tariffs could spark economic doom.
In an interview Sunday on NBC’s Meet the Press, Ray Dalio — the billionaire investor who founded the world’s largest hedge fund — delivered some scathing criticism of the president’s tariffs.
“Based on what you’re seeing right now, do you think that these tariffs are being carried out in a practical way or a chaotic way?” NBC’s Kristen Welker asked.
“So far, very disruptive,” Dalio replied. “We don’t know what the numbers are. But that could be part of a process, right? It depends where we are at the end of the [recently announced pause of] 90 days because what was put there is like throwing rocks into the production system, and those impacts would be enormous in terms of the efficiency of the whole world.”
Welker followed-up by asking about the broader implications.
“Do you think it is likely that the United States will dip into a recession because of President Trump’s tariffs?” Welker asked.
“I think that right now we are at a decision-making point and very close to a recession,” Dalio said. “And I’m worried about something worse than a recession if this isn’t handled well!”
He added, “We have a breaking down of the monetary order. We are going to change the monetary order because we cannot spend the amounts of money. So we have that problem. And when we talk about the dollar and we talk about tariffs, we have that. We are having profound changes in our domestic order … And we’re having profound changes in the world order. Such times are very much like the 1930s. I’ve studied history. And this repeats over and over again. So if you take tariffs, if you take debt, if you take the rising power challenging existing power, if you take those factors and look at the factors, those changes in the orders, the systems, are very, very disruptive. How that’s handled could produce something that is much worse than a recession! Or it could be handled well.”
The Meet the Press moderator noted that Dalio correctly predicted the 2008 financial crisis. She then prompted Dalio to go a little deeper on the potential fallout of the Trump tariffs.
“What specifically are you warning of?” Welker asked. “Are you saying that it could be as bad as a depression? What’s your biggest fear?”
“The value of money — what is a ‘storehold’ of wealth?” Dalio said. “That is a bond. In other words, one man’s debt is another man’s assets, bond holders. And so we’re going to be a situation where if that “storehold” of wealth is in jeopardy because there’s too much supply and demand and so on, and we have a monetary inflation, we will have great disruptions. And that could be like the breakdown of the monetary systems of ’71. It could be like 2008. It’s going to be very severe. I think it could be more severe than those if these other matters simultaneously occur.”
“What’s worst case scenario that you’re warning of, to be very specific?” Welker asked.
“To be very specific, the value of money, internal conflict that is not the normal democracy as we know it, and international conflict in a way that is highly disruptive to the world economy and could even be a military conflict just as these breakdowns have occurred before,” Dalio said. “You know, we have a new order that began in 1945, a new monetary order, and a new geopolitical order. And these go in cycles that can be measured. And I worry about the breakdown of that kind of an order, particularly since it doesn’t need to happen.”
Watch above, via NBC.
