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Ray Dalio says the world is in a ‘great sag’ and echoes the 1930s
18-10-2019, 06:37 PM.
Post: #1
Ray Dalio says the world is in a ‘great sag’ and echoes the 1930s
Ray Dalio says the world is in a ‘great sag’ and echoes the 1930s
* Hedge fund titan Ray Dalio believes it is too late for central banks to reverse a global slowdown.
* Dalio is warning that current conditions remind him of the Depression-era environment.
* He says the world is currently entering a “great sag” as the natural cycle of growth ends.

David Reid
PUBLISHED THU, OCT 17 20191:04 PM EDT
UPDATED THU, OCT 17 20191:17 PM EDT

Hedge fund owner Ray Dalio said the global business cycle is in a “great sag” and the world’s economy holds at least two parallels to the 1930s.

Speaking a CNBC-moderated panel at the IMF and World Bank annual meetings in Washington, D.C. on Thursday, Dalio said it was now too late for central banks to make much difference as economies enter a natural downturn.

“This cycle is fading, we are now in the world in what I would call a ‘great sag’,” said Dalio, adding that monetary policy, and especially interest rate reductions, were unlikely to offer much stimulus.

“Europe is at the limitation of that, Japan is (too) and the U.S. doesn’t have much to go on for that,” he told CNBC’s Geoff Cutmore.

Dalio said the world was also experiencing the biggest wealth gap since the 1930s and that was creating political stress.

“In the United States the top one-tenth of 1% of the population has a net worth that is approximately equal to the bottom 90%,” he said.

More details in https://www.cnbc.com/2019/10/17/ray-dali...1930s.html
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19-10-2019, 10:17 AM.
Post: #2
RE: Ray Dalio says the world is in a ‘great sag’ and echoes the 1930s
A great sag may not be a bad thing. I will prefer low-growth, low-inflation, over fast-growth, hyper-inflation, and the concomitant sharp economic (and asset value) contractions.

In the meantime, a good number of the inefficient and non-innovative businesses will be pressured to exit the market. Giving way to more efficient businesses, or those that offer better products and services.

Barring contagion from a US stock bubble bust, SG & HK stock markets is unlikely to experience a severe drawdown, since there is no run-up in valuations to begin with. The exception being SG REITs, whose valuations looks a little bubbly.

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