As the United States gears up for a pivotal presidential election in 2024, billionaire investor Ray Dalio has a stark warning for American investors. He believes there is more than a one-in-three chance of a second American Civil War. In a recent interview with the Financial Times, Dalio advised investors to diversify overseas to protect their assets from potential decline.
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Who Is Dalio, and Why Is His Advice Noteworthy?
Mr. Dalio, the founder of the world’s largest hedge fund, Bridgewater Associates, handed over the reins to his predecessor in September 2022. The 74-year-old considers the upcoming election between current President, Joe Biden and past President, Donald Trump to be the most crucial of his lifetime. The outcome of this election, he argues, will serve as a litmus test for the nation’s stability and the potential for risks to spiral out of control.
In an interview with the Financial Times, Dalio estimated the probability of dramatic problems erupting at somewhere between 35% and 40%. According to Dalio, the release of the film “Civil War” in April further advances his growing concerns about the nation’s future.
Investing in a Troubled Country
Dalio advises investors to focus on “the best parts of the United States,” where innovation and capitalism still thrive. He also recommends U.S. investors move the rest of their money to more stable and, in his estimation, appealing jurisdictions outside the U.S., such as India, Singapore, Indonesia, Malaysia, Vietnam, and some Gulf states.
More covertly, investors like Warren Buffett of Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) are following this strategy. For example, Buffett has recently taken a $7 billion stake in Chubb (NYSE:CB), an American insurance company that relocated its operations to Switzerland in 2008. This move reflects a growing trend among decision-makers to seek stability and growth opportunities outside the U.S.
Political scientist Barbara F. Walter argues that investors like Dalio can support democracy through a more holistic approach to capitalism. She suggests investing in better healthcare, education, and a higher minimum wage to create a hopeful future for communities that are largely left behind by globalization.
The 2024 Election is Critical
As the 2024 elections approach, the U.S. finds itself at a crossroads. The outcome of this election will be a crucial determinant of the United States’ future and its ability to heal and march forward. The advice of Ray Dalio and other investors highlights the importance of considering alternative investment strategies in these uncertain times.
Key Takeaway
As the U.S. faces the possibility of a civil war, billionaire investor Ray Dalio advises investors to diversify overseas to protect their assets and potentially profit from the turmoil. He recommends focusing on the best parts of the United States and moving the rest of their money to more stable and attractive jurisdictions outside the U.S.
