- Billionaire investor Ray Dalio warns US, China ‘on the brink’ of war and ‘beyond’ ability to talk Fox Business
- US and China on the brink of war and beyond talks, says Ray Dalio Business Insider
- Big China investor Ray Dalio says that if the US goes to war with China, there should be rules like not fighting on each other’s soil Yahoo News
- Billionaire Ray Dalio just spent 13 days in China and has advice for the world’s 2 great powers ‘on the brink of going to war with each other’ Fortune
- War with China needs rules like not fighting on each other’s lands: Ray Dalio Business Insider
- View Full Coverage on Google News
Tag Archives: Dalio
Ray Dalio says watch out for rates reaching this level, because Wall Street stocks will take a 20% hit
After that CPI shock earlier in the week, Wall Street is fielding a fresh batch of data on Thursday, with the headline retail sales number coming in stronger than expected. And a disastrous rail strike may be inverted.
But there’s no cheering up billionaire investor and hedge-fund manager Ray Dalio who in our call of the day asserts the Fed has no choice but to keep driving up interest rates, at a high price to stocks.
And he’s putting some fairly precise guesswork out there. “I estimate that a rise in rates from where they are to about 4.5% will produce about a 20% negative impact on equity prices,” Dalio said in a LinkedIn post dated Tuesday.
Some are forecasting the Fed could hike interest rates by 100 basis points next week, a move not seen since the likewise inflationary 80s. The central bank’s short-term rate hovers between 2.25% to 2.5%, but Nomura, for one, sees that rate headed to 4.75% by 2023.
But Dalio thinks interest rates could even reach the higher end of a 4.5%-to-6% range. “This will bring private sector credit growth down, which will bring private sector spending, and hence the economy down with it,” he says.
Behind this prediction is the Bridgewater Associates founder belief that the market is severely underestimating where inflation will end up — at 2.6% over the next 10 years versus what he sees as 4.5% to 5% in the medium term, barring shocks.
Read: Why a single U.S. inflation report roiled global financial markets — and what comes next
As for what happens when people start losing money in the markets — the so-called “wealth effect” — he expects less spending as they and their lenders grow more cautious.
“The upshot is that it looks likely to me that the inflation rate will stay significantly above what people and the Fed want it to be (while the year-over-year inflation rate will fall), that interest rates will go up, that other markets will go down, and that the economy will be weaker than expected, and that is without consideration given to the worsening trends in internal and external conflicts and their effects.”
The markets
Stock futures
ES00,
-0.25%
YM00,
+0.02%
NQ00,
-0.48%
are slightly lower post data, as Treasury yields
TMUBMUSD10Y,
3.437%
TMUBMUSD02Y,
3.852%
keep climbinging and the dollar
DXY,
-0.10%
firms up.
Oil prices
CL.1,
-1.63%
are lower, along with gold
GC00,
-0.83%.
China stocks
SHCOMP,
-1.16%
HSI,
+0.44%
slipped after the country’s central bank left rates unchanged. European natural-gas prices
GWM00,
+4.13%
are on the rise again. Bitcoin
BTCUSD,
+0.64%
is trading at just over $20,000.
The buzz
Shares of Union Pacific
UNP,
-3.69%,
Norfolk Southern
NSC,
-2.16%
and CSX
CSX,
-1.05%
are rallying in premarket after the White House said it has reached a tentative railway agreement with unions. No deal by Friday would mean strikes and havoc for supply chains, grain markets and even the coming holidays. Read more here.
August retail sales rose a stronger-than-expected 0.3% as Americans spent on new cars while weekly jobless claims came in lower for a fifth-straight week and import prices dropped 1%. Elsewhere, the Empire State manufacturing index perked up on the heels of a deep negative reading, but the Philly Fed factory index worsened. Industrial production and business inventories are still to come.
Adobe shares
ADBE,
+0.85%
are dropping after a report the software company is mulling a $20 billion deal to buy graphic design startup Figma .
Vitalik Buterin, one of the co-founders of Ethereum, says the so-called “merge” is done, meaning the birth of a more environmentally friendly crypto. Ethereum
ETHUSD,
-1.22%
is up just a little right now.
A new lawsuit claims Tesla
TSLA,
+3.59%
has made false promises over Autopilot and Full Self Driving features. And move over Tesla, Apple
AAPL,
+0.96%
is now Wall Street’s biggest short bet.
Ericsson
ERIC,
-3.32%
ERIC.A,
-1.78%
ERIC.B,
-3.34%
is dropping after a double downgrade at Credit Suisse, who cited inflationary headwinds. Analysts lifted Nokia
NOKIA,
-0.51%
NOK,
-0.40%
to outperform, though the stock is barely moving.
Cathie Wood’s Ark Investment Management went on a dip-buying spree after Tuesday’s market meltdown, scooping up chiefly Roku
ROKU,
+0.44%.
Opinion: Pinterest never considered itself a social network. Until now.
Patagonia billionaire Yvon Chouinard is donating his entire company — worth $3 billion — to the climate fight.
Best of the web
No U.S. shale rescue for Europe.
Turkey finds an extra $24.4 billion laying around.
Queue to pay respects to Queen is 2.6 miles long and counting.
The tickers
These were the top-searched tickers on MarketWatch as of 6 a.m. Eastern Time:
| Ticker | Security name |
|
TSLA, +3.59% |
Tesla |
|
GME, +1.01% |
GameStop |
|
AMC, +1.95% |
AMC Entertainment |
|
BBBY, +4.66% |
Bed Bath & Beyond |
|
HKD, +311.78% |
AMTD Digital |
|
NIO, -0.14% |
NIO |
|
AAPL, +0.96% |
Apple |
|
APE, +0.94% |
AMC Entertainment preferred shares |
|
AMZN, +1.36% |
Amazon |
|
NVDA, -0.02% |
Nvidia |
Random reads
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Billionaire Ray Dalio Discusses Future of Money, Insists Some Governments Will Ban Crypto – Featured Bitcoin News
Billionaire Ray Dalio, the founder of the world’s largest hedge fund, Bridgewater Associates, has shared his view on cryptocurrency investing and the future of money. He believes that crypto will be banned by different governments.
Ray Dalio on the Future of Money and Crypto
Bridgewater Associates founder Ray Dalio discussed cryptocurrency regulation and the future of money in an interview with David Rubenstein Thursday.
Dalio currently serves as the Bridgewater Associates chairman and cochief investment officer. His firm’s clients include endowments, governments, foundations, pensions, and sovereign wealth funds.
He was asked, “How do you foresee crypto impacting the world order?” The Bridgewater chairman replied, “I think it’s interesting,” disclosing that he has “a tiny percentage” of his portfolio in crypto.
He explained: “I wanted to diversify but it’s a very vulnerable incident because they can track who is operating on it. It can be tracked.” He added:
It’ll be outlawed, probably by different governments.
In addition, Dalio opined: “In terms of its size, it has issues. So I think too much attention is spent on crypto.”
This was not the first time that the Bridgewater boss warned about governments outlawing cryptocurrencies. In January, he explained that the government outlawed gold and silver in the past, so they could similarly outlaw bitcoin. In September, he said governments could kill bitcoin if it becomes “really successful.”
Dalio further shared with Rubenstein:
I think that we are now in an era where we are going to have different types of money.
“We are going to question money as a medium of exchange but it’s also storehold of wealth,” the billionaire noted. “And we are going to be questioning what are the right storeholds of wealth in value.”
He concluded: “And, you are going to see around the world … the digital version of that take place in many forms … [and] You are going to see other forms of that competition … in the years ahead.”
What do you think about Ray Dalio’s comments? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Dalio says if Bitcoin gets too big regulators will kill it
Bitcoin Foundation chairman Brock Pierce addresses global growth in the crypto market.
Ray Dalio, the billionaire founder of Bridgewater Associates, splashed cold water on Bitcoin Wednesday, and said if the cryptocurrency ever gets too big, regulators will “kill it.”
“I think at the end of the day, if it’s really successful, they will kill it and they will try to kill it,” he told CNBC. “And I think they will kill it because they have ways of killing it.”
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The report pointed out that the currency has quadrupled in value over the past 12 months and hovered around $47,500 on Wednesday. In June, El Salvador became the first country to identify Bitcoin as legal tender.
Ray Dalio, billionaire and founder of Bridgewater Associates LP, speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., on Wednesday, May 1, 2019. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
BILLIONAIRE RAY DALIO SPEAKS OUT ABOUT ‘JOURNEY AND REFLECTIONS’ FOLLOWING SON’S SUDDEN DEATH
Dalio is not the first hedge-fund boss to question cryptocurrencies.
John Paulson, the hedge fund billionaire who made a fortune in 2008 when he shorted the housing bubble, said last month that he believes cryptocurrencies will eventually go bust.
Verdence Capital Advisors CEO Leo Kelly argues that it’s a ‘stretch’ for Bitcoin to be a replacement for currency.
The 65-year-old told “Bloomberg Wealth with David Rubenstein” that he wouldn’t recommend the investment to anyone. He said there is a cryptocurrency bubble that will “eventually prove to be worthless.”
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“I would describe them as a limited supply of nothing,” he said. “So to the extent there’s more demand than the limited supply, the price would go up. But to the extent the demand falls, then the price would go down. There’s no intrinsic value to any of the cryptocurrencies except that there’s a limited amount.”
Bridgewater’s Ray Dalio Warns Government Could Restrict Bitcoin Investments, Impose ‘Shocking’ Taxes – Bitcoin News
The founder and chief investment officer of Bridgewater Associates, the world’s largest hedge fund firm, has warned that the government could “impose prohibitions against capital movements” into assets such as bitcoin. He added that regulators may also impose changes in taxes that “could be more shocking than expected.”
Ray Dalio Warns About Government Prohibitions and Taxes
Ray Dalio, founder and chief investment officer of Bridgewater Associates, wrote a post on Linkedin last week entitled: “Why in the World Would You Own Bonds When…”
He pointed out that the bond markets currently offer “ridiculously low yields,” which “do not meet these asset holders’ funding needs.” The executive wrote, “There is now over $75 trillion of US debt assets of varying maturities,” adding that their holders will at some point want to sell them to get cash to buy goods and services with.
However, Bridgewater’s chief investment officer estimates that “at current valuations, there is way too much money in these financial assets for it to be a realistic expectation that any significant percentage of that bond money can be turned into cash and exchanged for goods and services.” He elaborated: “It has to be accommodated … via printing a lot of money and devaluing it, and restructuring a lot of debt and government finances, usually including large increases in taxes.”
Dalio explained: “Based both on how things have worked historically and what is happening now, I am confident that tax changes will also play an important role in driving capital flows to different investment assets and different locations, and those movements will influence market movements.”
The billionaire fund manager emphasized that “If history and logic are to be a guide, policymakers who are short of money will raise taxes and won’t like these capital movements out of debt assets and into other storehold of wealth assets and other tax domains,” warning:
They could very well impose prohibitions against capital movements to other assets (e.g., gold, bitcoin, etc.) and other locations. These tax changes could be more shocking than expected.
The Bridgewater Associates founder used Elizabeth Warren’s proposed wealth tax as an example, stating that it “is of an unprecedented size.” Citing his study of “wealth taxes in other countries at other times,” he expects this proposal “will most likely lead to more capital outflows and other moves to evade these taxes.”
Consequently, “The United States could become perceived as a place that is inhospitable to capitalism and capitalists,” Dalio opined, emphasizing that “the chances of a sizable wealth tax bill passing over the next few years are significant.” In conclusion, the Bridgewater executive cautioned:
One should be mindful of tax changes and the possibility of capital controls.
Dalio has been studying bitcoin over the recent months. In November last year, he admitted that he may be wrong about bitcoin but was nonetheless worried about governments outlawing cryptocurrency. In December, he said bitcoin could “serve as a diversifier to gold and other such storehold of wealth assets.” Then, in January this year, he said that “bitcoin is one hell of an invention,” revealing that his firm looking closely at the cryptocurrency.
What do you think about Ray Dalio’s warning? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.