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Linkedin/Ray Dalio/3-16-2020
“I imagine many others in similar circumstances and what that will mean for economic activity and market prices, and that’s seriously worrisome. These are only a couple of things that I’m thinking about and I’m sure what I’m thinking about is only a small percentage of the financial disruptions that will happen. Remember that most investors and businesses are long (i.e. holding assets hoping that they will go up in price) on a leveraged basis (financed with debt) so that the declines in asset prices that we are seeing will have even bigger financial effects than the unlevered price declines that we are seeing.”
USAGOLD note: A must-read …… Dalio’s analysis and recommendations go beyond what can be summarized here. What he describes, though, is a situation that defies easy resolution. Though he does not mention gold ownership as a means to bridging the current crisis in this article, he has recommended it in the past with his firm, Bridgewater, saying at the beginning of the year the metal could surge to $2000 per ounce (See below). We would be surprised, under the circumstances, that he has changed his mind even with the price declining. Hopefully, we will hear more from Dalio (or Bridgewater) on this score soon.
Please see: Bridgewater sees gold rallying as central banks ease/Financial Times/1-14-2020