One of the world’s most prominent hedge fund billionaires has warned that rising inequality is turning the US into an autocratic state and condemned business leaders for failing to speak out against Donald Trump’s policies. Ray Dalio, the founder of Bridgewater Associates, said “gaps in wealth” and a collapse in trust were driving “more extreme” policies in the US.
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The US president wants the Federal Reserve to cut interest rates in an effort to boost economic growth and combat rising unemployment. But the Fed’s chair, Jay Powell, has warned the president’s import tariff increases could push up prices with the effect that investors will sell US financial assets rather than see them devalued.
Dalio said attacks on the Fed “would undermine the confidence in the Fed defending the value of money and make holding dollar-denominated debt assets less attractive which would weaken the monetary order as we know it”.
“I am just describing the cause and effect relationships that are driving what is happening,” he said. “And by the way, during such times most people are silent because they are afraid of retaliation if they criticise.”...