• Billionaire investor Ray Dalio warns the U.S. is on the brink of a major economic downturn
• Rising debt, trade chaos, and global instability could trigger a crisis worse than a recession
• Protect your portfolio from uncertainty by investing in physical gold through a Gold IRA

Dalio Warns of Economic Crisis

Ray Dalio, founder of Bridgewater Associates and the man who famously predicted the 2008 financial crisis, is sounding a new alarm. In recent comments, Dalio warned that the U.S. is approaching a recession, and potentially something far worse.

“Right now we are at a decision-making point and very close to a recession,” Dalio said. “And I’m worried about something worse than a recession if this isn’t handled well.”¹

Dalio’s concerns stem from several growing threats to the global economy. Threats such as rising national debt, disruptive trade policies, and a breakdown of long-standing political and economic systems. These forces, he warns, could converge into a crisis that may rival or even surpass the financial upheavals of 2008 or 1971, when the U.S. abandoned the gold standard.

A Ticking Time Bomb

At the heart of Dalio’s warning is the soaring U.S. debt, which now exceeds $36 trillion. He described the debt burden as a “ticking time bomb”. Dalio pointed to a fundamental “supply-demand problem for debt”. In other words, there’s too much debt and not enough buyers.

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Congress, he says, must reduce the federal deficit to 3% of GDP to restore fiscal balance. But even that may not be enough to avoid economic turmoil.

Dalio also drew stark comparisons to the 1930s. He noted “profound changes” in both domestic and global orders. He said that the world is moving away from a multilateral order led by America. And it’s moving towards a more fragmented, conflict-driven unilateral one.

Disruptive Tariffs and Trade Uncertainty

Trade tensions are a major contributor to the instability. Tariffs aim to balance trade and bring production back home. But they are causing chaos in the global economy. Dalio likened the tariff policies to “throwing rocks into the production system.”  He said that although the goals may be understandable, the implementation has been “very disruptive.”³

The White House has announced a 90-day pause on reciprocal tariffs.  But they are maintaining a 10% baseline tariff and a 145% tariff on Chinese goods. Though some exemptions have been made for consumer electronics. With no clear end in sight, these rapidly shifting policies have upended international trade.  There is “tremendous uncertainty” about which tariffs will remain in place and for how long.

The administration says that the main aim of these policies is to restructure global trade. But Dalio fears they might trigger instability on a scale not seen in decades. “How that’s handled could produce something that is much worse than a recession,” he warned.⁴

A Breakdown of Monetary and Political Order

Dalio’s warnings go beyond trade.  “The far bigger, far more important thing to keep in mind is that we are seeing a classic breakdown of the major monetary, political, and geopolitical orders,” he said. “This sort of breakdown occurs only about once in a lifetime, but they have happened many times in history when similar unsustainable conditions were in place.”⁵

In his worst-case scenario, a financial and trade crisis could even escalate into a military conflict. “It’s going to be very severe,” he concluded.

Why Dalio Holds Gold

In the face of these dire predictions, Dalio uses gold as a hedge against risk.

“History and logic demonstrate that when there are substantial risks that debts will either default or be repaid with depreciated currency, both the debt and the currency become unappealing,” Dalio explained. “Gold, conversely, is a non-debt-backed form of money.”

He adds that gold is “like cash, except unlike cash and bonds, which are devalued by the risks of default or inflation, gold is bolstered by the risks of debt defaults and inflation.”⁶

As governments around the world attempt to manage their debt by printing more money, currencies risk losing value. This process, known as inflating the debt away, often leads to hyperinflation, another reason gold can serve as a safe haven.

Dalio describes gold as “money that I can go from one place to another with. And it’s accepted around the world; it’s accepted by central banks. Today, by the way, gold is the third-largest reserve after dollars and euros… it’s an asset that is not somebody else’s liability.”⁷

He also notes that gold typically has a negative correlation to traditional portfolios. Meaning it tends to rise when other assets fall. “If you were to say, what if I was to overlay gold in my portfolio, it would reduce the risk and increase the expected return.”

Conclusion

If you’re concerned about inflation, debt, and the possibility of a crisis worse than a recession, you’re not alone. Ray Dalio has studied history and sees troubling patterns repeating. He’s protecting his assets with gold, and you can do the same.

At American Hartford Gold, we help individuals protect their savings with physical gold held in a Gold IRA. You can take control of your financial future—call us today at 800-462-0071 to learn how.

Notes:

1. https://www.cnbc.com/2025/04/13/billionaire-ray-dalio-im-worried-about-something-worse-than-a-recession.html
2. https://www.crfb.org/blogs/12-month-rolling-deficit-21-trillion-march-2025
3. https://www.reuters.com/markets/wealth/bridgewaters-ray-dalio-says-trump-trade-war-has-put-us-close-recession-2025-04-13/
4. https://www.cnbc.com/2025/04/13/billionaire-ray-dalio-im-worried-about-something-worse-than-a-recession.html
5. https://www.nbcnews.com/politics/politics-news/investor-predicted-2008-financial-crisis-says-worried-something-worse-rcna201040
6. https://markets.businessinsider.com/news/etf/billionaire-investor-ray-dalio-is-sticking-with-gold-as-a-hedge-against-inflation-history-and-logic-show-that-1033269427
7. https://markets.businessinsider.com/news/etf/billionaire-investor-ray-dalio-is-sticking-with-gold-as-a-hedge-against-inflation-history-and-logic-show-that-1033269427

 

• U.S. Treasuries, once a cornerstone of financial stability, are losing their safe haven status amid rising yields and global uncertainty.
• Foreign investors are retreating from U.S. debt, and the unwinding of hedge fund strategies is adding to market volatility.
• As traditional safe havens falter, gold is emerging as a reliable shield against market instability and inflation.

A Market Once Seen as Untouchable

For decades, U.S. Treasuries were considered the bedrock of the global financial system. But today, confidence in the world’s biggest economy is under intense pressure as the $29 trillion Treasury market experiences a sharp and unsettling sell-off.

Prices on government bonds have plunged. Investors are questioning whether U.S. Treasuries still deserve their long-held status as a safe haven. ING analysts captured the market’s mood perfectly. Saying, “The ‘sell America’ trade is currently dominating the market,” affecting both stocks and bonds. ING continued, “Treasuries are not behaving as a safe haven.”¹

“Existential Financial Crisis”

Yields on the 10-year Treasury jumped to 4.45%. That’s a seven-week high and a significant leap from levels below 4% just days earlier. The 30-year bond rose above 5%, marking the biggest three-day surge since 1982. Because Treasury yields move inversely to bond prices, this jump signals a major decline in investor appetite for U.S. debt.²

Columbia economic historian Adam Tooze summed it up starkly: “This is the script for a truly existential financial crisis.” The ripple effect is already being felt. Rising yields increase borrowing costs across the globe. Businesses and households are now facing more expensive loans and mortgages. The gap between 2-year and 10-year yields widening to its largest point since 2022.³

The Sell-Off Sparks Global Alarm

This sudden turmoil has upended the traditional role of U.S. bonds as a refuge during economic stress. Stocks have also taken a hit, with the S&P 500 teetering on the edge of bear market territory, down more than 20% from recent highs.

The following chart shows the rise in implied volatility in the bond market, which reflects growing expectations of future price fluctuations in bonds.

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The spark for the sell-off came from rising tariffs. China retaliated against U.S. tariffs of 104% with duties of its own totaling 84%. That initial jolt set off a fire sale, further fueled by growing fears of recession, inflation, and stagflation.

JP Morgan Asset Management declared, “The global safe haven status is in question.” Former U.S. Treasury Secretary Lawrence Summers echoed the concern. He said the broader sell-off signaled a “generalized aversion to U.S. assets in global financial markets.”  Summers warned about the potential for a “serious financial crisis.”⁵

The Rush to Cash

Investors are made a “dash for cash” while the Dow tumbled more than 4,500 points. As a result, money market funds hit record highs through April 2.

This isn’t without precedent. In 2020, panicked investors also dumped bonds. And triggered a liquidity crunch so severe that the Federal Reserve had to step in and stabilize the market.

Also, the most recent bond auctions are drawing the least interest seen in years. Demand for U.S. Treasuries is waning, and the cost of insuring against a U.S. default is climbing.

Foreign Investors Are Pulling Back

“Markets are now concerned that China and other countries could ‘dump’ U.S. Treasuries as a retaliation tool,” said the chief investment adviser at BNP Paribas Wealth Management.⁶

Global institutional investors are already heavily invested in U.S. assets. Thanks to the dollar’s reserve status and America’s traditional reputation as a safe harbor, many funds had become overweight in U.S. debt. But now, with total U.S. debt surpassing $36 trillion and reaching over 120% of GDP, those same investors have plenty to offload.

China alone holds approximately $760 billion in U.S. Treasuries. But they’ve been reducing its holdings as it pursues de-dollarization.  If China accelerates these sales as a response to tariffs, it would be considered a financial “nuclear option.” Not only would it send U.S. interest rates soaring. It could spark an even deeper stock market sell-off. It would also depreciate the dollar and trigger another wave of inflation. China, too, would suffer, facing a rising yuan and steep losses on the bonds it sells.

The “Basis Trade” Unwinds

Another factor behind the bond market disruption is the unwinding of the so-called “basis trade.” In normal times, hedge funds are consistent buyers of Treasury bonds, using them to hedge against futures market exposure. Though the profit per trade is minuscule, it’s nearly risk-free—so firms use high leverage, sometimes as much as 50x to 100x.

But according to many reports, that trade is now unraveling. Hedge funds are no longer buying, and in many cases, they’re actively selling off their Treasury positions. Adding more pressure to an already volatile market.

Will the Fed Step In?

The Federal Reserve may be forced to respond by cutting rates more than previously expected. But the situation is complicated. Some experts believe the Fed is unlikely to intervene quickly. Especially as the effects of new tariffs continue to drive inflation higher.

Conclusion

The global economy is undergoing a dramatic transformation. Long-held assumptions are being challenged. Bonds are losing their safe haven status just when uncertainty is reaching new highs.

So where can Americans turn to protect their wealth? Increasingly, the answer is gold. Governments, institutions, and individuals are setting record demand for gold as a shield against market volatility. When held in a Gold IRA, gold offers long-term security—even when the traditional pillars of the financial system begin to crack. Call American Hartford Gold at 800-462-0071 to learn how you can protect your future with gold.

Notes:

1. https://www.axios.com/2025/04/09/bond-market-10-year-treasury-yield
2. https://www.nytimes.com/2025/04/09/business/economy/bonds-tariffs-safe-haven.html
3. https://www.axios.com/2025/04/09/bond-market-10-year-treasury-yield
4. https://archive.is/tofOI/3a551d17d654bb926a096952d7e35e112c16b125.jpg
5. https://www.nytimes.com/2025/04/09/business/economy/bonds-tariffs-safe-haven.html
6. https://finance.yahoo.com/news/bond-rout-starting-sound-market-042240998.html

 

• BRICS are actively working to reduce global reliance on the U.S. dollar through de-dollarization and digital payment systems.
• A weaker dollar could lead to higher inflation, rising interest rates, and economic instability in the U.S.
• Precious metals held in a Gold IRA can help protect savings against the risks of de-dollarization.

BRICS and De-dollarization

De-dollarization is accelerating, and with it, the threat to the U.S. economy. The BRICS bloc has long sought to challenge the U.S. dollar’s dominance. Both to shield their economies from a weaponized dollar and to unseat the U.S. as the global superpower. As the movement gains momentum, concerns are growing. Especially now that the BRICS are exploring ‘digital dollars’ to disrupt the current financial order. The BRICS are taking a long-term, steady approach to de-dollarization. But once they succeed, the consequences for the U.S. will be severe. Americans need to start thinking long-term too, which means preparing now.

Trump Fights De-Dollarization

President Trump made his stance clear on this issue. He claimed that the BRICS bloc was “dead” and threatened to impose tariffs of 150% on imports from BRICS nations for “playing games with the dollar.” He also warned that if BRICS countries proceeded with their plans, they would lose the opportunity to sell any of their assets to the United States. ¹

BRICS Expansion

The BRICS bloc is continuing to expand its influence. Besides the original five members, the group has added Iran, Ethiopia, the UAE, Egypt, and Indonesia. Countries like Malaysia, Vietnam, and Thailand are now considered “partner countries.”

Together, it represents approximately 54.6% of the global population. 27% of the global nominal GDP and 36% of global GDP at Purchasing Power Parity (PPP). They occupy around 25% of the world’s total land area. BRICS has a significantly larger population and land area than the U.S. and Europe combined. The West may lead in nominal GDP but is comparable in GDP at PPP terms.²

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A variety of factors are fueling de-dollarization. Countries like Russia, China, and Iran face the pressures of U.S. sanctions. Others, like Brazil, are motivated more by economic pragmatism than geopolitics. For years, the standard practice for international trade has been to first convert local currencies into U.S. dollars. Conduct the trade in dollars. And then convert back to the local currency. But this system can prove costly and inefficient. The BRICS nations are eager to find alternatives.

The Observa China think tank said, “The aim is to develop an alternative payment system allowing trade to be settled in local currencies, an idea that gains traction each time Washington imposes sanctions or exerts pressure on member states.”⁴

In fact, de-dollarization is already happening. Ninety five percent of trade between Russia and China is being conducted in rubles and yuan.

BRICS Goes Digital

The BRICS are taking major steps to build a new global financial infrastructure to rival the West. The bloc has created the New Development Bank as an alternative to the IMF. They see the IMF as a tool for Western control.  The BRICS nations are also creating a secure global messaging platform to compete with SWIFT, the dominant network for international bank transfers.

One notable initiative is the creation of BRICS Pay. It’s a decentralized payment system developed by China and Russia. This system aims to unite the financial markets of BRICS member states. Increasing trade volume and helping transactions as a result. It uses digital financial assets (DFAs) like cryptocurrencies and tokenized gold. By adopting DFAs such as blockchain networks, BRICS can bypass Western sanctions. They are making a digital end run around the U.S. dollar’s influence in international trade.

Russia has expressed confidence in the long-term potential of this shift. As one Russian official noted, “We should not expect a huge leap forward… there is still a long way to go to gradually transition from payments in national currencies to the creation of a single BRICS currency.” The creation of a single BRICS currency may still be distant goal. But the groundwork for de-dollarization is already being laid.⁵

Consequences of De-Dollarization

If the U.S. dollar loses its status as the world’s primary reserve and trade currency, the consequences could be far-reaching. A weaker dollar could result in reduced global demand. Thereby driving up the cost of imports and leading to higher inflation. With more expensive imports, businesses and consumers would face increased costs. This could push the U.S. to raise interest rates to attract investors. However, higher rates would also increase borrowing costs, further challenging the U.S. economy.

Additionally, a weaker dollar could lead to economic instability. It can cause market volatility and uncertainty. The U.S. would also lose much of its economic leverage. Imposing sanctions or influencing global trade could become impossible.

Conclusion

The BRICS nations are steadily pursuing de-dollarization. And now, they are adopting digital assets to break the world financial system. The U.S. economy faces significant threats. A weakening dollar, higher inflation, and rising interest rates are all possible.  And they all could have negative consequences for your savings and investments. To protect the value of your retirement funds during these uncertain times, consider putting your savings into physical precious metals. Held in a Gold IRA, they can help safeguard your financial future from the risks of de-dollarization. To learn more about how a Gold IRA can help secure your future, call 800-462-0071 today.

Notes
1. https://www.scmp.com/news/china/article/3303030/de-dollar-diplomacy-brics-interest-alternative-global-currency-stirs-trumps-ire
2. https://en.wikipedia.org/wiki/BRICS
3. https://www.isdp.eu/wp-content/uploads/2024/10/Backgrounder-BRICS-Oct-19.pdf
4. https://www.scmp.com/news/china/article/3303030/de-dollar-diplomacy-brics-interest-alternative-global-currency-stirs-trumps-ire
5. https://moderndiplomacy.eu/2025/03/27/brics-game-changing-blockchain-payment-system-the-future-of-global-transactions/

• Rising inflation and slowing growth spark renewed fears of stagflation.
• Stagflation puts the Fed in a no-win situation—fighting inflation risks hurting jobs, but easing up fuels inflation.
• Gold and silver can help protect retirement savings during economic turmoil.

Signs of Stagflation Grow

Investors are on edge as troubling signs emerge in the U.S. economy. The growing threat of stagflation, where inflation soars while jobs disappear, has them bracing for the worst. The Federal Reserve’s latest economic projections contributed to an 8% slump from an all-time high in the S&P 500 index. According to RSM Chief Economist Joe Brusuelas, we may be heading into a period of “stagflation-lite.” A potentially disastrous situation for retirement savings.¹

The Federal Reserve’s Stagflation Warning

The Federal Open Market Committee (FOMC) recently downgraded its economic growth outlook. They are predicting only a 1.7% expansion this year. That’s a 0.4 percentage point decline from its December forecast. At the same time, the committee raised its inflation expectations. Signaling uncertainty in its economic outlook.²

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Fed officials are now facing a dilemma. If inflation doesn’t approach the 2% target, interest rates may stay high for an extended period. The Fed is taking a “wait and see” approach. They want to see how tariffs affect inflation and economic growth.

In theory, a weak economy with rising unemployment should stop inflation. The two shouldn’t coexist. One of the major challenges of stagflation is that it offers no easy fixes. The Federal Reserve has a dual mandate. It aims to control inflation and maximize employment. However, this creates a conflict. If the Fed raises rates to combat inflation, it can slow down economic growth and increase unemployment. Conversely, lowering rates could fuel inflation further.

Chicago Fed President Austan Goolsbee summarized the challenge. He said, “There is nothing more uncomfortable than a stagflationary environment, where both sides of the mandate start going wrong. There is not a generic answer… Is it worse on the inflation side or the job market side? Higher tariffs raise prices and reduce output—that is a stagflationary impulse.”⁴

A Return to 1970s Stagflation?

The current economy isn’t as bad as the stagflation of the 1970s…yet. But some economists say the conditions are starting to appear. The stagflation crisis of the 1970s was driven by oil price shocks and poor economic policies. Similarly, today’s rising national debt and increased money printing contribute to inflationary pressures. The money supply issue today feels more urgent than it did in the 70s. Making the battle against inflation even tougher.

Market Reactions and Strategies

Bank of America recently warned that the risk of stagflation is growing. They told clients to move from risky assets to safer investments. “In recent weeks, some of the economic data has weakened and inflation has stayed sticky, so that’s caused questioning of whether we could be in a stagflationary environment,” said Jill Carey Hall, a U.S. equity strategist at BofA.⁵

JP Morgan’s trading desk warned that the Fed’s new economic forecasts suggest stagflation. Economist Torsten Slok of Apollo Management emphasized the seriousness of the issue. Saying, “the Fed is worried that the ongoing stagflation shock is going to intensify further.” Meanwhile, Bankrate analyst Mark Hamrick echoed this sentiment. He stated, “Recession risks are clearly rising.”⁶

Gold and Precious Metals: A Safe Haven

Investors aiming to protect their portfolios during stagflation should look at safe-haven assets. Gold and silver can help. Unlike stocks, precious metals often gain value during recessions. This happens as fiat currencies lose their purchasing power.

Phil Carr of FXStreet noted, “Precious metals like gold, silver, platinum tend to be big winners in inflationary environments.” Recent data from GSC Commodity Intelligence supports this. It showed a record $4.9 billion flow into gold in February, the highest ever recorded.⁷

Conclusion

The U.S. economy isn’t at the stagflation levels seen in the 1970s, but warning signs are clear. High inflation, slow economic growth, and rising unemployment present a challenging economic landscape. The Federal Reserve is unsure of its next moves. Making it hard to predict how long these conditions will last.

In such uncertain times, protecting your wealth with gold and silver can be a prudent move. A Gold IRA from American Hartford Gold can help safeguard your retirement savings from the effects of stagflation. Call us today at 800-462-0071 to learn how you can secure your financial future with precious metals.

Notes
1. https://www.reuters.com/markets/us/stagflation-radar-us-economy-no-repeat-70s-2025-03-25/
2. https://seekingalpha.com/article/4769977-is-1970s-stagflation-back
3. https://verifiedinvesting.com/blogs/verified-statistics/federal-reserve-sees-higher-inflation-slower-growth-ahead-stagflation
4. https://economictimes.indiatimes.com/news/international/global-trends/us-news-stagflation-on-the-radar-for-the-us-economy-fed-chair-jerome-powells-big-remark-on-1970s-nightmare/articleshow/119477721.cms?from=mdr
5. https://www.bloomberg.com/news/articles/2025-03-24/bofa-dusts-off-stagflation-playbook-for-stocks-as-fed-flags-risk?embedded-checkout=true
6. https://www.audacy.com/wwl/news/national/is-stagflation-rearing-its-head-in-the-u-s
7. https://www.fxstreet.com/analysis/could-stagflation-trigger-golds-next-big-move-video-202503121727