Dalio Sounds Alarm on US Debt Crisis, Advises Investors to Diversify

Bridgewater Associates co-founder Ray Dalio has warned that the US faces an annual fiscal gap of up to $2 trillion, with approximately $10 trillion in debt requiring refinancing. Without changing course, the debt crisis could arrive 'within three years, plus or minus two years,' according to Dalio. He advises investors to reduce bond holdings to mitigate debt risk and increase gold allocations to 10%, 15% of the portfolio.

Dalio also called on the US to reduce its budget deficit from the current level of approximately 6% of GDP to 3%, through measures such as cutting spending, increasing taxes, and lowering interest rates. Following his remarks, gold prices rose on Friday to their highest level since May, while Bitcoin broke through $77,000, posting its largest single-week gain since 2023.