In Friday’s On My Radar, Steve features Ray Dalio’s recent LinkedIn post on the condition of the global economy. Dalio is the founder of Bridgewater Associates, the largest hedge fund in the world. In sum, according to Dalio:
The near term looks good, but the longer term looks scary. That is because:
The economy is now at or near its best, and we see no major economic risks on the horizon for the next year or two.
- There are significant long-term problems (e.g., high debt and non-debt obligations, limited abilities by central banks to stimulate, etc.) that are likely to create a squeeze,
- Social and political conflicts are near their worst for the last number of decades, and
- Conflicts get worse when economies worsen.
So while we have no near-term economic worries for the economy as a whole, we worry about what these conflicts will become like when the economy has its next downturn.
Steve suggests that advisors show Dalio’s piece to their clients. Further, Steve says that advisors should tell clients to be careful and not to buy into the long-term buy-and-hold passive investment trap. For more, click below to read On My Radar.READ MORE