Ray Dalio’s retirement last year from the hedge fund he founded, Bridgewater Associates, has given the billionaire more time to indulge his other great passion: history., frequently warning that the build-up in debt seen across Western economies will eventually spark a major crisis.But the veteran investor now admits he got something wrong: the stunning resilience of the private sector in the face of one of the fastest interest rate tightening cycles in living memory.
“In the US and globally, the central governments’ balance sheets and income statements are bad and getting worse because the governments ran and are still running large deficits. They also have big losses on the government bonds they bought to fund the government debts and, with their balance sheets where they are, are losing money where interest rates are.
Dalio is not saying this will happen, but the history student in him wants to make it clear that these big debt build-ups are not typically resolved without pain.
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Source: 9NewsSyd - 🏆 23. / 51 Read more »