Ray Dalio: The United States is at the brink of the fifth stage of the "Long-Term Debt Cycle," facing risks of a civil war and an order breakdown.
BlockBeats News, January 27th: Ray Dalio, founder of Bridgewater Associates, posted a long article on social media with in-depth analysis, warning that the United States is currently in the fifth stage of his "long-term debt cycle" theory (on the eve of order breakdown), with multiple indicators showing that society may be sliding towards the sixth stage (civil war and order breakdown). His key judgment factors include:
· Deterioration of Finance and Conflict: High government deficits, escalating debt, and a historical high wealth and values gap, creating a "classic deadly combination."
· Populism and Polarization: Increasing political polarization, moderates losing their voice, media becoming a tool of partisan struggle, and the public sphere experiencing a "loss of truth."
· Escalation of Violent Events: The recent death of a protester in Minneapolis and the conflicts between the federal and state governments are typical signs of the transition to the sixth stage.
· System Dysfunction: The legal and political systems are increasingly being used as weapons of conflict, with rules giving way to a "win-at-all-costs" logic.
Ray Dalio stated that the current situation is highly similar to the prelude to the order restructuring of 1930-1945. If consensus cannot be built through leadership and painful but necessary reforms cannot be implemented, society may repeat the mistakes of civil war/revolution. Investors and policymakers should acknowledge the power of cycles, promote productivity-oriented reforms (in education, infrastructure, research), and replace "zero-sum struggles" with "win-win cooperation" to prevent the system from sliding into irreversible collapse. Although the trajectory is difficult to change, before sliding into the sixth stage, it is still possible and necessary to mitigate conflicts through wise choices and reshape broad prosperity.
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