He said Billionaire Ray Dalio, founder of Bridgewater, the world’s largest hedge fund, A “devastating hurricane” is forming that would spread economic pain globally, in light of the US Federal Reserve’s uncompromising policy, noting that government stimulus programs during the Corona pandemic created a bubble.
Dalio, who recently handed over control of his $ 150 billion company to a new generation of investors, added that internal tensions between the US population caused by “irreconcilable differences” and a growing wealth gap, as well as conflicts. international, all contribute to the formation of the “Perfect Storm”, according to “Reuters”, reviewed by “Al Arabiya.net”.
At the Greenwich Economic Forum, Dalio said: “The Fed and the government together issued huge amounts of debt and credit, adding to a gigantic ‘front loading’ that led to the current bubble.”
He explained: “The situation has now turned in an attempt to stop this huge load by pressing hard on the brakes, which will result in a giant backward bounce.”
The term “front loading” is used to describe attempts to push the economy to grow, and is compared to loading a truck only at the front, which creates a state of imbalance and is difficult to stop.
To fight inflation, Dalio said the Fed will continue to raise interest rates, adding, “There will be real pain of course,” noting that interest rates above 4.5% could push the economy into deflation. .
