Ray Dalio: US ‘on the brink of civil war’, but it’s not people ‘picking up guns and starting shooting’

Benzinga

May 21, 2024 12:36 PM ET

Billionaire investor and Bridgewater Associates founder Ray Dalio has issued a dire warning about the escalating political and social divide in the US.

“We are on the brink of civil war right now” – Dalio

In a recent interview with the Financial Times, Dalio estimated the chance of a civil war as high as 40%, a figure that underscores his deep concerns about the state of the country.

The civil war Dalio envisions is not necessarily one where people “pick up guns and start shooting”. Instead, he sees it as an acceleration of the political polarization that has characterized American politics in recent decades. In this civil war, he told the Financial Times, “people move to different states that are more aligned with what they want, and they don’t follow the decisions of federal authorities that have opposing political views”.

Bridgewater Associates, founded by Dalio, is one of the world’s largest and most influential hedge funds. Over the past few years, Dalio, 74, has gradually scaled back his formal role at the firm. He stepped down as CEO in 2017 and as co-CIO last October. He does still participate more informally as a mentor to the CIO, offering advice and meeting with investors.

However, Dalio has long been vocal about his concerns about the political and economic climate in the U.S.

He pointed to several key factors that he believes have led to the country's precarious position:

Extreme levels of government debt

Severe wealth inequality

Growing internal political divisions

Ongoing external conflicts.

Dalio said that "we are on the brink now" and that we "don't know yet whether we will enter more turbulent times," and stressed the urgent need to focus on these issues to prevent potential disasters.