Dalio: China must solve its debt problem or face a lost decade

Bridgewater Associates founder Ray Dalio warned that China should cut debt and loosen monetary policy or face a "lost decade."

Bloomberg quoted Dalio as saying in a post that when there is a lot of debt and a huge gap between rich and poor, and at the same time, there are huge domestic and international power conflicts, and/or huge disruptive changes in nature and huge changes in technology, The possibility of a "hundred-year storm" will increase.

He added that tensions between China and the United States have led foreign investors to diversify or leave China altogether for fear of being discriminated against. This makes it difficult for China to obtain investment. If economic and cultural conflicts are not resolved, the possibility of war in the next decade is very high.

To address the debt problem, Dalio recommended that China implement both deleveraging and loose monetary policy, but acknowledged that such a move would not be easy and politically risky as it would lead to a sea change in wealth levels.

Leave a Reply

Your email address will not be published. Required fields are marked *