Connecticut’s Ray Dalio believes income inequality may be leading the United States toward autocracy.
Dalio, founder of the world’s largest hedge fund, Bridgewater Associates, was the richest person in Connecticut as of 2023, according to Forbes, and was No. 59 on Forbes’ list of the 400 wealthiest people in the world in 2024.
Speaking with the Financial Times, Dalio said that wealth disparity may lead to increased polarization which, in turn, leads to autocratic leadership, calling it a "classic part" of the "debt cycle."
“The increased wealth and values gaps lead to increased populism of the right and populism of the left and irreconcilable differences between them that can't be resolved though the democratic process,” Dalio told the Financial Times. “At such times, democracies weaken and more autocratic leadership increases as a large percentage of the population wants government leaders to get control of the system to make things work well them — e.g., ‘to make the trains run on time.’”
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When asked, Dalio declined to use the word “authoritarian,” saying he’d “rather not put labels on it because labels are evocative and lead to bad reactions.”
Dalio compared current socioeconomics to “what happened around the world” before, during and after World War II.
“Like in the 1930 to ‘40 period, the gaps in wealth, gaps in values, and views about what policy should be have become more extreme — and the willingness to compromise, lose elections because of voting results, and trust in the system have dwindled,” he said. “I think most people are silent because they are afraid of retaliation if they speak up.”
Dalio sold his remaining stake in Westport-based Bridgewater earlier this year, bringing to a close a years-long retirement process.
“From my perspective of being a 76-year-old who loves Bridgewater and the people at Bridgewater (many of whom I have worked with for decades), it's like seeing my kids being strong and healthy without me, which is much better than being a 76-year-old parent having to take care of them,” Dalio wrote on social media site LinkedIn.
Speaking with the Financial Times, Dalio also criticized President Donald Trump’s attempts to impact the decision-making process at the Federal Reserve.
Trump has said he wants the Federal Reserve to cut interest rates, a move the independent body has resisted in part due to uncertainty around Trump’s imposed tariffs.
Dalio expressed concern that Trump “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,” though he declined to say if it was Trump’s policies specifically that were creating such uncertainty.
“I am just describing the cause and effect relationships that are driving what is happening,” he said.
Dalio plans to answer questions during an AMA on social media site Reddit 1-3 p.m. Sept 4.
Jordan Nathaniel Fenster is a reporter with CT Insider. He's worked as a journalist covering politics, cannabis, public health, social justice and more for 25 years. Jordan's work has appeared in The New York Times and USA Today in addition to multiple regional and local newspapers. He is an award-winning reporter, podcaster and children's book author. He serves as senior enterprise reporter and lives in Stamford with his dog, cat and three daughters. He can be reached at [email protected].