Ray Dalio Makes Sense But He’s Talking His Own Book

The investor Ray Dalio has given us the benefit of his new world view in a LinkedIn post that takes a baseball bat to the idea of safety in holding bonds — or anything, really, in dollars. While much of his logic is undeniable it does suit a recent shift in where his firm Bridgewater Associates has been winning mandates, namely in China.

The trouble with Cassandras portending the end of empires is in the timing. His negative dollar view is popular right now, and one I share albeit for different reasons. But with the new Biden administration successfully getting its $1.9 trillion stimulus package passed, the short-term dynamic looks more favorable for the greenback. The OECD expects the U.S. economy to grow 6.5% this year, which will outperform global growth expectations of 5.6%. It won’t be easy to shift investment dollars away from the world’s superpower when its economy is running hotter than many emerging markets.