Ray Dalio Warns That U.S.-China Ties In "Risk Period"

The world’s two largest economies are on the edge of war, and the situation will worsen as the US heads into the presidential election in 2024, according to Ray Dalio, founder of Bridgewater Associates, Ye Xie reported for Bloomberg News.

Photo Insert: While a war isn’t inevitable, many “red lines” will be pushed up against with “brinksmanship,” including issues on Taiwan, Beijing’s dealing with Moscow, and the US’s move to cut off China’s access to essential semiconductors, Dalio wrote.

“The hawkish political influences in the US will exert more pressure on the relationship over the next 18 months because of the emergence of the 2024 election season,” Dalio, who has traveled to China twice recently, wrote in a LinkedIn post on Wednesday.

“That will be a very risky period because China and the US are now already on the brink of war.”

While a war isn’t inevitable, many “red lines” will be pushed up against with “brinksmanship,” including issues on Taiwan, Beijing’s dealing with Moscow, and the US’s move to cut off China’s access to essential semiconductors, he wrote.

“Each one is risky, and together they carry a lot of risk,” he said. Taiwan, which China views as its territory and a top national security priority, will hold its own presidential election in January 2024 — 10 months before the US one.

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