Bridgewater Associates founder Ray Dalio discusses response to the U.S. debt on ‘The Claman Countdown.’
Congress formally handed President Donald Trump’s “massive, lovely invoice,” and billionaire Ray Dalio is warning concerning the doable financial penalties, which might embody spending cuts, main tax will increase and big cash printing.
“Except this path is quickly rectified to convey the finances deficit from roughly 7% of [gross domestic product] to about 3% by making changes to spending, taxes, and rates of interest, massive, painful disruptions will possible happen,” Dalio, the founding father of Bridgewater Associates, wrote in a submit on X Thursday.
Dalio stated the invoice, which now heads to the president’s desk to be signed into legislation, is predicted to lead to yearly deficits of $2 trillion with revenues of about $5 trillion exceeded by spending of about $7 trillion.
This deficit would improve the nationwide debt over the following decade, pushing the debt, at the moment the equal of about $230,000 per U.S. household, to about $425,000 per household, he warned.
AMERICA HEADED FOR ‘ECONOMIC HEART ATTACK’ ON GOVERNMENT DEBT, SPENDING WARNS BILLIONAIRE
Ray Dalio, founder and CIO mentor of Bridgewater Associates, speaks onstage throughout The Wall Road Journal’s 2024 The Future Of All the pieces Competition at Spring Studios Could 22, 2024, in New York Metropolis. (Dia Dipasupil/Getty Photos / Getty Photos)
Paying off this debt can even turn into more and more costly. Curiosity and principal funds on the debt would rise from round $10 trillion, $1 trillion of which is curiosity, to round $18 trillion, $2 trillion of which might be curiosity. This might lead to both spending being slashed, “unimaginable” tax will increase or a variety of “printing and devaluing of cash and pushing rates of interest to unattractively low ranges,” he stated.
BILLIONAIRE RAY DALIO RAISES ALARM OVER CHINA, SAYS TRUMP RENEGOTIATING TRADE DEALS ‘HAS TO HAPPEN’
“This printing and devaluing will not be good for these holding bonds as a storehold of wealth, and what’s unhealthy for bonds and U.S. credit score markets is unhealthy for everybody, as a result of the U.S. Treasury market is the spine of all capital markets, that are the backbones of our financial and social situations,” Dalio stated.
Speaker of the Home Mike Johnson, R-La., shakes fingers with Home Majority Whip Tom Emmer, R-Minn., and Home Republican Convention Chair Lisa McClain, R-Mich., alongside different Home Republicans throughout an enrollment ceremony for the One, Massive, Beautif (Kevin Dietsch/Getty Photos / Getty Photos)
Final month, Dalio equally sounded the alarm on America’s power spending on FOX Enterprise Community’s “The Claman Countdown,” saying the U.S. is headed for an “financial coronary heart assault.”
BILLIONAIRE HEDGE FUND MANAGER WARNS TARIFFS COULD TRIGGER CONDITIONS ‘WORSE THAN A RECESSION’
“We’re spending 40% greater than we’re taking in, and it is a power drawback,” he stated. “So, what you are seeing is the debt service funds starting to squeeze away, not starting, effectively, into squeezing away. So, it is like plaque within the arteries squeezing away shopping for energy. And, as you are able to do the numbers, you will note that you would be able to have an financial coronary heart assault because of that.”
President Donald Trump pumps his fist as he boards Air Drive One at Morristown Municipal Airport in Morristown, N.J., June 21, 2025. (Mandel Ngan/AFP by way of Getty Photos / Getty Photos)
On Thursday afternoon, Congress handed Trump’s “massive, lovely invoice” after back-to-back sleepless classes for each the Home and Senate. The invoice, which advances Trump’s insurance policies on taxes, the border, protection, power and the nationwide debt, narrowly handed the Home of Representatives in a principally party-line vote.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
All however two Home Republicans, Thomas Massie, R-Ky., and Brian Fitzpatrick, R-Pa., voted for the invoice, which handed 218-214.