Investment guru Ray Dalio urged savvy investors to watch their financial backs as the current economic climate draws to a close.
The billionaire founder of the world’s biggest hedge fund told CNBC the current cycle will end in about two years.
The Federal Reserve shouldn’t hike interest rates faster than the market expects, said Dalio, co-chairman and co-chief investment officer of Bridgewater Associates. He said such a strategy should help keep the economy and stocks growing at a steady pace.
Dalio warns that investors should be “more defensive” in the stock market and “as time progresses” he sees the risks increasing.
The “upside looks limited” because a lot of cash on the sidelines has been put to work and the benefits of the corporate tax cuts are “behind us,” he added.
The next crisis won’t be a big bang-type affair but one that leads to more severe social and political problems, says Dalio.
Meanwhile, Dalio said he doesn’t think U.S. tariffs on China are “that big of a deal.”
The U.S. economy expanded in the second quarter at a slightly faster pace than previously estimated on revisions to imports and software spending, bolstering the strongest period of growth since 2014, according to Commerce Department data releasted last month.
For his part, Trump has taken to Twitter to tout his economic accomplishments.
“Trump has set Economic Growth on fire. During his time in office, the economy has achieved feats most experts thought impossible. GDP is growing at a 3 percent-plus rate. The unemployment rate is near a 50 year low.” CNBC…Also, the Stock Market is up almost 50% since Election!” he tweeted Sunday.
Trump followed that tweet up on Monday with another message.
“The Economy is soooo good, perhaps the best in our country’s history (remember, it’s the economy stupid!), that the Democrats are flailing & lying like CRAZY! Phony books, articles and T.V. “hits” like no other pol has had to endure-and they are losing big. Very dishonest people!” the president tweeted.
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