Billionaire Ray Dalio Says “Capitalism Is Not Working” for Most People

Discussion in 'Wall St. News' started by dealmaker, Nov 9, 2018.

  1. dealmaker


    Billionaire Ray Dalio Says “Capitalism Is Not Working” for Most People
    ByMary Childs
    Nov. 9, 2018 11:20 a.m. ET
    Bridgewater Associates founder Ray Dalio. Photography by Astrid Stawiarz/Getty Images
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    Billionaire hedge fund founder Ray Dalio may not be the first person you’d think of as a crusader against capitalism.

    But at the Summit conference in Los Angeles this week, he questioned the current U.S. economic system. “Capitalism is basically not working for the majority of people,” he said.

    Dalio has a net worth estimated at $18 billion, according to Forbes, largely gained from building and running Bridgewater Associates, the largest and—by some metrics—most successful hedge fund in the world. His critique is all the more noteworthy, coming from one of the system’s biggest winners.

    “Economics and markets are my day job,” said Dalio, who published a book in September titled A Template for Understanding Big Debt Crises.

    His comments come as many people in the so-called millennial generation and younger are questioning the structure of the U.S. financial system. Born in the economically buoyant late 1980s and 1990s, millennials and Generation Y have watched vast wealth accrue for those who already had it, a polarity that was only exacerbated during and after the financial crisis as inequality has widened to its worst level since 1928.

    Read more: Ray Dalio’s Principles for Success

    It’s reached enough of a din to inspire billionaire co-founder of Home Depot, Ken Langone, to publish a book May called I Love Capitalism! (it has 4.5 stars on Amazon), and last month the White House Council of Economic Advisers released a presentation titled “The Opportunity Costs of Socialism.”

    Still, critiques abound. Jonathan Tepper and Denise Hearn’s forthcoming book, The Myth of Capitalism, argues that the current U.S. system is so dominated by monopolies that it isn’t true capitalism. There’s also Anand Giridharadas’ Winners Take All, published in August, which posits that the efforts by the global elite to save the world through philanthropy serves to preserve the status quo that benefits them—and to mask their own participation in creating the crises they’re purporting to fix.

    It’s showing up in politics: Sen. Bernie Sanders (Ind., Vt.) rode a popular wave to be runner-up for the Democratic nomination for president in 2016, and then this week democratic socialist Alexandria Ocasio-Cortez became the youngest woman ever elected to Congress, after her surprise upset of the Democratic incumbent in the primary.
    Dalio has spoken about the pressing problem of inequality for years—and has warned that artificial intelligence will help to worsen it.

    In his speech this week, he cited a Federal Reserve survey statistic that 40% of U.S. households could not raise $400 in case of emergency without selling something.

    “We might not have contact with those people, but that is a reality,” Dalio told the crowd, who paid thousands of dollars to sit on the Palace Theater’s velvet seats and hear him speak.

    The current polarization—both politically and socially—is most analogous to the 1930s, he argued. “It has to be dealt with,” Dalio said, saying if he were running things, he’d declare the wealth gap and opportunity gap a “national emergency.”

    If the government “created metrics that literally judged the conditions of people, and then took responsibility for changing those metrics, there’s a lot that can be done in private-public partnerships and so on to be able to change it,” he said. “But I fear that probably will not be done by the next time we have a downturn, and I fear for what that conflict is going to be like.”

    Write to Mary Childs at
  2. Handle123


    What a crock of sh.t. What life has come down to in USA is how to get more for free instead of getting educated or working your rump off in some other way. Twenty year old males staying in parents basements saying they can't get a job when there is more unfilled jobs than ever.

    How come foreigners come here to live, in few years start businesses and people born here looking for free housing? Changing the metrics? Unless you bulldoze ghettos and build and sell to people who didn't make the ghettos, you not going to change anything. People who get free, end up destroying what they live in.

    You think Dalio willing to give up half of what he has to go for free housing.

    System works fine, you work hard, learn to save, invest in yourself.
  3. Great example by @Handle123 of not reading a single thing.
    Sprout likes this.
  4. After your post, I read the Dalio story over twice.

    Just what is it that Handle "doesn't get"?
  5. 1) Dalio has said nothing about giving anyone anything for free, in fact he has said the opposite numerous times.

    2) Dalio is pointing out that there is a segment of the US citizenship that you probably never come in contact with, the 40% who can't scrape together $400 for an emergency.

    3) If the system is working, then it is only working for the 60%. That should not be acceptable to you because such an imbalance will lead to violence, as Dalio has said numerous times (and has happened before.)

    Edit: I am not advocating for free stuff either.
    murray t turtle and CME Observer like this.
  6. America and capitalism were NEVER about "equal outcome", but rather "equal opportunity". Not that "great opportunity is handed out equally to all", but rather we're all free to make our own opportunity if we can.

    There are always stories about those who started a company or developed a web app... or got themselves educated to the point the world would pay a good price for their services. That "opportunity" is still there today... for those who can and will take advanage.

    I recently read a story... that about 6% of Americans have a net worth of >$1MM. Looks like some made something of themselves rather than expecting someone else (government?) to "hand it to them".
    Last edited: Nov 9, 2018
  7. A man will not understand something if (he thinks) his salary depends on him not understanding it - This thread.
  8. English, please?
  9. ElCubano


    "equal opportunity" <--------- unfortunately it doesn't work out that way for many and certainly not when the concentration of money falls into fewer hands. It's simple logic he is trying to explain.
    Sprout and RRY16 like this.
  10. destriero


    @Handle123 lives in a trailer. Ray Dalio is worth billions.
    #10     Nov 9, 2018
    Frederick Foresight and RRY16 like this.