Ray Dalio on the present economic condition
Billionaire investor Ray Dalio believes that the present economic condition in the US is similar to conditions in the mid-to-late 1930s.
Dalio made the following comparisons between current times and the 1930s:
- large deleveraging
- monetization of debt that helped the economy and markets grow
- protectionist approach
- huge wealth gaps
- strong impact of populist leader
- prevalence of populist, militarist, and nationalist ideology
- appearance of new world powers to confront the old
In October 1929, the market saw a huge crash, which led to a 12-year depression that affected all major Western countries. The Dow Jones Industrial Average (DIA) saw sharp drops of 12.8% on October 28, 1929, and 11.7% on October 29.
You may be interested to read, Jack Bogle Explains How Long-Term Investors Can Lose for more information.