On Apr. 13, 2025, a U.S. billionaire and founder of the biggest hedge fund, Bridgewater Associates, Ray Dalio, told NBC’s Meet the Press reporter that “right now we are at a decision-making point and very close to a recession.” Still, he is worried about “something worse than a recession.” He shared his view of a possible upcoming catastrophe and outlined what could be a remedy.
“Worse than a recession”
The Meet the Press reporter asked Dalio to explain what he meant when he said that the tariff problem is a symptom of a greater problem. Dalio indicated several simultaneous issues at once. According to Dalio, these problems are the growing government debt that changes the American monetary order and the internal political conflict that changes the American political order.
On top of it, Dalio said that external conflicts, changing technologies, and natural disasters (like floods, pandemics, etc.) are the factors contributing to instability. He said that tariffs are carried out in a chaotic and “very disruptive” way, lacking quality negotiations, pragmatism, and stability. However, Dalio noted that the outcome would be clear in 90 days, probably due to a pause in tariffs applied by the Trump Administration.
When asked about the probability of a recession, Dalio answered that the recession per se is not something terrible; it’s just two consecutive quarters of negative GDP, while the challenges that America is facing now are more profound, and they may change the domestic and monetary order in the U.S. Dalio compared the upcoming crisis with the 1930s, the Great Depression times.
According to Dalio, if the budget deficit is not regulated, the country will face a supply and demand problem for the U.S. debt. Potentially, it may break the monetary system down. If it happens combined with other challenges mentioned above, the country may slip into a more severe state than it had during the Great Depression years or the 2008 financial crisis. Dalio warned the listeners about the possible internal conflict, saying that it “is not the normal democracy as we know it.” Additionally, Dalio doesn’t exclude the possibility of America’s involvement in an international military conflict. The new crisis may disrupt the world order created in 1945.
“Tariffs are only a symptom.”
In the Meet The Press interview, Dalio didn’t provide any details on how he sees the future crisis. Days before this interview, Dalio shared a popular long X post titled “Don’t Make the Mistake of Thinking That What’s Now Happening is Mostly About Tariffs.” In the first lines of the post, Dalio stresses that tariffs are only a symptom of the bigger issue. The large debt is what sets a dangerous imbalance in the world’s economy.
Here’s what he wrote about the instability of the current world order:
The old monetary/economic order in which countries like China manufacture inexpensively, sell to Americans, and acquire American debt assets, and Americans borrow money from countries like China to make those purchases and build up huge debt liabilities will have to change. These obviously unsustainable circumstances are made even more so by the fact that they have led to American manufacturing deteriorating, which both hollows out middle-class jobs in the U.S. and requires America to import needed items from a country that it is increasingly seeing as an enemy.
The only positive possible outcome of Trump’s tariff policy is that it will spark technology development in the U.S. by bringing manufacturers back to the country. However, due to other factors, the U.S. is going to go through several disruptive processes. According to Dalio, the old system cannot survive, and it’s up to the government to let it go the easy or hard way.
Despite the fact that Dalio is very critical of the way the tariffs were deployed, some of his commenters still found a way to see Trump’s policy as a remedy for the crisis described by Dalio. However, the billionaire offers his own vision of how to stop the crisis.
Dalio offers a solution
Not only does Dalio see various challenges, but he also outlines the method to prevent the “worse than a recession” crisis from coming to life. According to Bridgewater Associates founder, Congress should take a “3% pledge” and reduce the budget deficit to 3%.
Although Dalio is very concerned with the current problems, he still believes there is a way out. If the government doesn’t take action asap, Dalio thinks the deficit will increase to 7% and trigger other negative factors that will eventually disrupt the American monetary system.
Can Bitcoin be a solution?
Dalio is not that conservative on crypto and holds some in his portfolio. Obviously, he doesn’t see it as a universal safe haven, but rather as an interesting new asset class that may diversify his portfolio. Dalio says he prefers gold to crypto. Both assets reached their respective record prices this year.
Dalio’s reservations about Bitcoin include crypto’s transparency (the government knows what Dalio holds and can tax him) and volatility. According to Dalio, Bitcoin cannot be a reserve currency as it is rather a speculative asset.
Donald Trump and Michael Saylor explore Bitcoin’s potential to devour the U.S. national debt, which is the root of all evil, judging by what Dalio writes and says. If Trump and Saylor are right, Bitcoin may save America from a crisis that is worse than a recession. However, Larry Fink of BlackRock warns about the opposite: the U.S. debt may undermine America’s global leadership in crypto.
