Billionaire hedge fund mogul Ray Dalio is warning that Donald Trump is pushing the U.S. into a 1930s-style autocracy.
The Bridgewater Associates founder told the FT that government meddling in business—including Trump’s acquisition of a 10 percent stake in Intel—echoed the “strong autocratic leadership that sprang out of the desire to take control of the financial and economic situation.” He said many investors are too afraid of Trump to speak out.
It comes amid a backdrop of increasingly extreme policies, Dalio said, fueled by “gaps in wealth” and “gaps in values” and a decline in trust.
“I think that what is happening now politically and socially is analogous to what happened around the world in the 1930-40 period,” Dalio, who has an estimated $15.4 billion fortune, said.
Dalio’s words come against a backdrop of the president striving to limit press freedom, punish political rivals, deploy the military to cities, and even suggest that Americans would like to live under a dictator.
The veteran financier stated that greater division in wealth across the population leads, in turn, to more populism on both the political left and right, and “irreconcilable differences between them that can’t be resolved through the democratic process.”
This leads to a weakening of democracy and “more autocratic leadership” as growing segments of the population opt instead to surrender their freedoms to their leader, believing that in doing so, they will improve their lives.
Meanwhile, Wall Street’s biggest names have been reluctant to criticize the administration since Trump’s return to power—Dalio thinks they’re scared to speak up.
“I am just describing the cause and effect relationships that are driving what is happening,” he said. “And by the way, during such times most people are silent because they are afraid of retaliation if they criticize,” he added.
The Daily Beast has contacted the White House for comment on Dalio’s remarks.
Dalio also raised the alarm about Trump’s threats to the independence of the Federal Reserve after the president tried to fire one of its governors.
Trump has long feuded with Fed Chair Jerome Powell over Powell’s resistance to the president’s pressure to lower interest rates. In his latest battle, Trump has claimed to have fired the Fed’s Joe Biden-appointed governor, Lisa Cook, who, in turn, filed a lawsuit to challenge the attempt.
Dalio said a central bank effectively controlled by the administration, where interest rates are not fixed autonomously, “would undermine the confidence in the Fed defending the value of money and make holding dollar-denominated debt assets less attractive, which would weaken the monetary order as we know it.”
He isn’t the only person concerned with the moves being made by Trump. Trump-supporting Shark Tank star Kevin O’Leary also raised the alarm over the government taking a stake in Intel, saying that a failing company should be allowed to die.
“I abhor this idea. I really do,” O’Leary fumed on CNBC’s Squawk Box last month. “What has made America so great for 200 years is the government stays in its lane, and the private sector does what it does so successfully.”
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