Description
Do big government debts and fast rates of adding to them threaten our collective well-being? In this analysis, Ray Dalio shares the reasons behind his concerns for the US debt markets and answers some of the most important market and economic questions we now face. Are there limits to debt growth? Can a big, important reserve currency country like the US really go broke? Is there such a thing as a “Big Debt Cycle” that can tell us when to worry about debt and what to do about it?
For decades, politicians, policymakers, and investors have debated these questions, but the Big Debt Cycle that helps answer them is not well understood.
Dalio has built his career as a global macro investor by studying historical patterns to develop unconventional perspectives on markets and economies. In the years leading up to the 2008 Great Financial Crisis, he studied the Great Depression and other past big debt crises and used what he learned to navigate turbulent markets. By examining thirty-five cases over the past 100 years when governments have gone broke and studying the mechanics behind them, Dalio developed a template for what to watch for and what to do when the threat is significant, which he assesses to be the case now.
He has discussed this template with treasury secretaries and central bankers from around the world and is sharing it with the public to bring attention to the risks the US and other countries face and to explain how to avoid the worst-case scenario.
Provides a detailed analysis of the Big Debt Cycle, explains its implications, and offers a straightforward solution for controlling debt problems.
Endorsements
#1 New York Times bestselling author of Principles