Bridgewater’s Ray Dalio: invest in gold and bitcoin rather than debt assets

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Indebtedness in the US, China and most major countries has increased at ‘unprecedented levels’ and will not be sustainable, he says

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Ray Dalio, founder of Bridgewater Associates, speaks during a Wall Street Journal event on May 22, 2024 in New York City. Photo: Getty Images

Aileen Chuang

Published: 6:30pm, 10 Dec 2024Updated: 3:06pm, 11 Dec 2024

Billionaire investor Ray Dalio, founder of the world’s largest hedge fund Bridgewater Associates, said he would invest in “hard money” like gold and bitcoin while avoiding debt assets, as most major economies face rising indebtedness problems.

“I believe that there would likely be a pending debt money problem,” he said in a speech during the Abu Dhabi Finance Week (ADFW) in the United Arab Emirates on Tuesday. “I want to steer away from debt assets like bonds and debt, and have some hard money like gold and bitcoin.”

Gold and bitcoin have both been trading near record highs as investors seek hedges against economic uncertainties, geopolitical tensions and new monetary policies. Bitcoin surged past US$100,000 for the first time last week amid US president-elect Donald Trump’s welcoming rhetoric towards the digital asset. Hard money refers to a currency backed by a physical commodity like gold and silver, or bitcoin for its stable and controlled supply.

He added that the indebtedness seen in the US, China and all major countries except Germany has increased at “unprecedented levels” and the amount will not be sustainable.

“It is impossible for these countries to be able to not have a debt crisis in the years ahead that will lead to a great decline of [money] value,” Dalio said.

“Debt, money and the economy” represent one of five big forces he has identified that will drive “just about everything”, he said.

The other forces include countries’ internal political order, driven by wealth and value gaps, and external geopolitical order, stemming from power conflicts such as US-China tensions.