Ray Dalio warns Trump: Fix deficit now or face crisis

Ray Dalio, founder of Bridgewater Associates and a major figure in the U.S. hedge fund industry, warned the Trump administration to address the U.S. deficit immediately or risk a major debt crisis within three years, according to Bloomberg. “If you don’t do it, you’re going to be in trouble,” Dalio said on the Odd Lots podcast, likening the situation to an impending heart attack. He urged policymakers to cut the deficit to 3% of GDP to avoid long-term instability. Dalio also cautioned about a growing imbalance in the U.S. debt market, noting that major buyers of Treasuries—foreign central banks, domestic banks, and the Federal Reserve—have stepped away. He suggested that, in a crisis, the U.S. could move to restructure its debt, a move that would shake global markets. On alternative assets, Dalio said Bitcoin (BTC) could play a role in future monetary systems due to its resistance to seizure and taxation. He also recommended gold as a hedge, advising investors to hold 10% to 15% of their portfolio in the metal for diversification.