Ray Dalio warns of global collapse beyond tariff disputes

Bridgewater Associates founder Ray Dalio has issued a stark warning about a once-in-a-lifetime breakdown of global systems, cautioning that the focus on tariff headlines is masking deeper disruptions.

Writing on social media platform X, Dalio emphasised that tariffs are merely symptoms of broader systemic issues, including excessive debt, political polarisation, and shifting global power dynamics.

Dalio characterised the current era as a unique historical occurrence in which the political, monetary, and geopolitical foundations are disintegrating.

“This sort of breakdown occurs only about once in a lifetime,” he stated, drawing parallels to past periods of economic and political upheaval.

He pointed to widening inequalities in income and education, the erosion of middle-class jobs in the U.S., and growing distrust between nations as evidence that the existing order is no longer sustainable.

The hedge fund manager highlighted five major forces driving this transformation: debt, politics, international power shifts, climate change, and technology.

He argued that these forces interact to push the world toward instability, urging observers to look beyond surface-level events like trade disputes.

“Don’t make the mistake of thinking that what’s now happening is mostly about tariffs,” Dalio warned.

On the domestic front, Dalio expressed concern over the fraying U.S. political system and the breakdown of democratic norms.

He noted that polarisation and value-based migration are empowering extreme factions while undermining compromise.

Internationally, he observed how the U.S. has shifted from multilateral cooperation to unilateral strategies, further destabilising global relations.

Dalio’s remarks align with his broader predictions about economic cycles and geopolitical conflict.

In previous interviews, he has warned that rising debt levels and populist politics could lead to internal disorder and weaken international cooperation.