Ray Dalio says the tariffs can prepare us for large conflicts or war

The investing Mogul Ray Dalio said that the tariffs were not only a question of tax revenue, but also a way for the federal states to prepare their economies for conflict and war times.

When the Trump administration on Wednesday against China, the European Union and dozens of other regions against China, in a LinkedIn post -announced in a LinkedIn post that import taxes are “necessary” in times of an international great power conflict.

The reason for the billionaire? They tend to rely on foreign supply chains.

Dalio, who founded the Hedge Fund Bridgewater Associates, wrote that the tariffs “can reduce both imbalances of the performance account and capital account”.

“What means in simple English to reduce the dependencies on foreign production and foreign capital, which is particularly valued in times of global geopolitical conflicts/wars,” added the billionaire.

He wrote that tariffs make local companies less efficient because global supply chains are suppressed, but are more survival, as long as domestic consumers can still buy enough of their goods.

Dalios Post did not specifically analyze the tariffs of the Trump administration, which means that he does not necessarily say that the White House introduced these taxes in the expectation of the war.

Rather, he wrote about tariffs in general and emphasized their typical effects and the motivations for governments to introduce such measures.

For example, the billionaire wrote that tariffs tend to bring into the countries they introduce and bring stagflation into the world.

Dalios point about an “international great power conflict”, however, corresponds to the billionaire’s regular warnings that the world moves at a time great argument and a high risk of war.

The billionaire published a book about this belief in 2021, in which he predicted that the US China competition would bring fundamental, messy changes in the execution of the world.

In any case, US debts have to be tackled, says Dalio

In his post on Wednesday over tariffs, Dalio remembered another of his usual points about the state of the world: he believes that the US government’s debt crisis must be solved. The ratio of debts to GDP is around 120%.

“Production, trade and capital containers (especially the debts) have to come down in one way or another, since they are not dangerous for monetary, economic and geopolitical reasons,” he wrote.

Dalio warned in February that the debt would cause the US financial system a “heart attack” if it accumulates.

“You essentially have a high risk of this heart attack, and now what will you do about it?” he said.

At the time, he said that the office of Elon Musk’s office would try to reduce the state budget, but would not be sufficient to determine the debt crisis alone.

Bridgewater Associates and Principles, Dalios Book brand, did not respond to comment inquiries for Dalio, which were sent outside of regular business hours.