According to Dalio, the United States is currently very close to an economic downturn, and he mentioned that if things are not handled properly, something worse could happen.

As President Donald Trump’s trade war escalated with tariff increases, bringing along concerns of an economic recession, American billionaire investor Ray Dalio warned that the US economy could face something worse than a recession. Speaking to NBC, the hedge fund billionaire stated, “I think we are at a decision point right now and very close to a recession. I am worried that if it is not handled well, something worse than a recession will occur.”

Reminding that a recession means two quarters of negative gross domestic product or a trend in that direction, Dalio stated, “These things have always happened. Right now, something much bigger is at stake. We are facing a monetary order breakdown. We are going to change the monetary order because we cannot spend this much money.” “HISTORY REPEATS ITSELF” Dalio’s remarks came after the announcement of a 145% tariff by the US on China and a 125% tariff by China on the US. The billionaire explained significant changes in both the domestic and global orders, referring to the events of the 1930s and saying, “I’ve read history; this repeats over and over. So, if you look at tariffs, debt, emerging powers challenging existing powers, these factors, changes in orders, systems are very destructive. How we deal with them can create something far worse than a recession. Or they can be dealt with in a good manner.”

Having correctly predicted a recession in 2008, Dalio stated that the current economic situation in the US is at “a crossroads.” The billionaire mentioned that the US budget deficit could be reduced to 3% of the gross domestic product, but warned that if nothing is done, this rate could reach approximately 7%.