Today's economic environment is similar to the investor sentiment around 1937, signaling the possible beginning of a tightening, billionaire Ray Dalio, chairman and chief investment officer at investment firm Bridgewater Associates, said at CNBC and Institutional Investor's Delivering Alpha conference in New York on Tuesday, Sept. 12.
There's a lot of tension in the bottom 60% of the economy, Dalio said. That could lead to a resurgence of populism as global conflict escalates. The wealth gap and social conflicts rank among Dalio's chief concerns in the market.
Dalio said the United States is still in a 2.5% or 3% growth type of economic environment, not the loftier goals set by the Trump administration at its start.
Part of the growth rate -- which Dalio described as not too hot and not too cold -- is held back by outstanding obligations the federal government still stands to pay down in debts and pensions.
"It's not just a matter of debt ... it's a matter of pensions, it's a matter of healthcare -- those kinds of obligations to be paid," Dalio said. Increasing the rate of economic growth stems from creating a pro-business environment, Dalio added.
Dalio said in May that he saw markets nearing their best.
The billionaire hedge fund manager said Tuesday that if Gary Cohn left the Trump administration, it would be "terrible," and "bad for the market." The move would send the wrong message not only to Washington, but also to Cohn's replacement as Trump's chief economic advisor.
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