Ray Dalio Says to Abandon Bonds for Cash - 2024

Bloomberg is reporting today on statements made by Ray Dalio, the owner Bridgewater, of the world's largest hedge fund, in Singapore yesterday.

Dalio is reported to have said, "Temporarily, right now cash is good." And, "I don't want to own debt".

Dalio's position is of course consistent with his concerns about US continuing to service its debt at current interest rates. It is clear that he now believes that as higher long terms rates continue over time that these risks will materialize to create higher yields as the US and other sovereigns are forced to raise the interest rate they are paying.

Other hedge funds managers, including Bill Ackman, have been piling into this thesis as well. I personally believe that an additional factor that could lead to higher longer-term rates is that the climate crisis will result in a global shift in supply chains that will also be very inflationary (as I pointed out at the end of this article earlier this week).

Yet, I don't know if all of this is going to come to pass right away. I also would not be shorting the 10-year or the 30-year Treasury. And, I think Dalio's comments as they are being reported could lead folks to want to run away from short-term US Treasury bills, which would be a silly reaction.

But, Dalio's words do reflect some caution that folks should think about. You should always have some of your assets in money market and savings accounts. Start here.