Ray Dalio, the founder of Bridgewater Associates, one of the world's largest hedge funds, has expressed intense concerns that the economic agenda of US President Donald Trump could lead to "something worse than a recession." "Right now, we are very close to a recession and at a critical decision-making point," Dalio told NBC, warning that if the situation is not handled correctly, developments could be even more severe than a simple economic slowdown.
What "worse than a recession" means
A recession is typically defined as two consecutive quarters of negative GDP growth. However, Dalio speaks of something deeper: a potential collapse of the existing monetary order underpinned by the United States. The veteran investor, who famously predicted the 2008 crisis, estimates that the risks are not limited to the US economy but concern the global financial system as a whole.
Tariffs, debt, and geopolitical upheavals
According to Dalio, Trump’s tariff policy has already caused turbulence in international trade. He expresses fear that the US may become isolated as major trading powers could move toward agreements that exclude the American economy. As he notes, the world is entering a phase of realignment, similar to that of the 1930s, where combinations of high debt, trade conflicts, and the rise of new powers lead to profound changes.
Economic data: Growth with "cracks"
Despite the warnings, latest data shows the American economy continues to grow, with GDP increasing by 2.1% in 2025. However, signs of a slowdown are evident. The labor market showed almost zero growth last year, with only 181,000 new jobs—a dramatic decrease compared to 2024. Although an improvement is recorded in 2026, with 178,000 new positions in March, unemployment remains at 4.3%. Meanwhile, inflation is strengthening, reaching 3.3% on an annual basis, mainly due to rising energy costs, while consumer confidence records historically low levels.
The role of international developments
Geopolitical instability, and particularly the conflict with Iran, further burdens the US economy, intensifying inflationary pressures and increasing uncertainty in the markets. Even in the event of de-escalation, the economic impact is expected to last for months, burdening both businesses and households.
How citizens can prepare
In the face of this uncertain environment, experts recommend that citizens take measures to protect their finances. A key first step is the creation of an emergency fund covering at least three to six months of expenses. At the same time, it is suggested to reduce high-interest debt and avoid new borrowing. Diversifying investments is also considered critical, with options such as gold and real estate acting as a hedge against inflation and crises. Finally, working with financial advisors can help in formulating a risk management strategy, especially during periods of increased uncertainty.
A fragile economic landscape
Despite continued growth, Ray Dalio’s warnings highlight the fragility of the global economy. As he points out, the issue is not only whether there will be a recession, but whether current policy choices will lead to a deeper, structural crisis of the international economic system.
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