The risk of some kind of civil war., An internal war or an external war, trade war technology, war, geopolitical influence, war, capital, war, military war, cyber war, space war, drone warfare., Ray Dalio, just predicted the collapse of America and detailed exactly how the economic system is faltering.. History always repeats itself. And while humans always innovate, emotions never change.. The economy functions in cycles, because human behavior is extremely predictable..

Newer generations always repeat the same mistakes as the older generations, because most are not informed about history., Ray Dalio believes that he recently spotted a big cycle that is pointing towards the downfall of the American empire.. Dalio is the Founder and CEO of the world's largest hedge fund Bridgewater Associates, which has generated immense returns from macroeconomic bets over the past few decades.. There are three main indicators that Dalio is closely watching.. First of all, the Wealth and Opportunity Gap are creating significant division within the United States., While Household Wealth is broadly increasing in the US, the upper class has grown their wealth disproportionately compared to the lower class., As demonstrated by this graph.

The Household Wealth of the bottom, 50 % of the United States, is lagging behind by a considerable amount.. The wealth gap is becoming so significant that the top 10 % of the US now owns 70 % of the entire US wealth.. A thriving economy is typically great., But the wealth gap is instigating growing tension between the economic classes.. We can see this with how polarizing politics has become., Whether you like it or not.

The political spectrum is becoming increasingly radical.. This is creating internal disorder, a key factor to the downfall of economic powerhouses.. The next major concern is the US government's growing debt balance, which has been exacerbated by the pandemic. Total US.

Debt has increased from roughly $ 15 trillion in 2012 to $ 29 trillion today.. Despite this massive debt problem, the government is still continuing to spend enormous sums of money.. Congress recently attempted to pass the Build Back Better Bill, which would have cost $ 1.9 trillion if it passed.. However, Senator Joe Manchin prevented the bill from passing by voting against it.

Even though the Build Back Better Bill didn't pass, the Federal Reserve isn't helping inflation at all.. Interest rates are still at 0 % at the moment, although the Fed does plan to raise rates soon.. All of this is happening, while the inflation rate is accelerating to levels that cannot be called transitory anymore. To make matters even worse.

A rising world power which is China, is challenging the US as the most powerful world power., Regardless of whether you like China or not one thing, is clear.. China's becoming more and more economically competitive.. The CEBR World Economic League recently predicted that the Chinese GDP will surpass the US GDP by 2028.. China is changing the world order by growing its economy at incredibly quick rates that could eventually overtake the US.

Dalio covered this in depth. In his new book `` Principles for Dealing with The Changing World Order.'' China challenging the US as the dominant power is called external disorder.. Ultimately, there are three different cycles that are converging right: now., The long-term debt and capital market cycle, the internal order and disorder cycle and the external order and disorder of cycle.. These cycles have played out many times with the Dutch, British and Chinese empires..

For instance, the Dutch experienced a similar level of power after they invented the first stock market, which was an effective measure for building the country's wealth.. This prosperity created a wealth gap where only the richest people had the greatest opportunities, such as being educated.. The Dutch empire built ships that allowed them to bring their currency globally, allowing their currency to become the reserve currency. For reference.

A reserve currency is when other countries trust a currency to hold its value.. Therefore, other countries began to hold the reserve currency in an effort to protect their country in the event that their own currency fails.. Over time, the Dutch became complacent about their economic position.. The Dutch had less work ethic, had a higher cost of living and also produce goods at more expensive rates..

In order to stay competitive with new countries. Like the UK, the Dutch were forced to acquire enormous sums of debt.. This eventually set the stage for their downturn.. These events have happened over and over again, and Dalio now believes it is happening to the US..

The only thing I care about is whether we're productive, whether we increase the size of the pie through productivity and then divide it. Well, so that you create the something closer to equal opportunity that produces greater political stability and also draws on the population going wide. And the reason I say that is because I've studied these empires. These dynasties going back since the last 500 years, and you see the same thing happening over and over again.

When there's a financial problem when the granaries are empty and the coffers are empty, they print money. And when they print money and the coffers are empty. It devalues money. And with that, when you have a large gap of people at each other's throats, then you create a risk of an internal conflict, a risk of some kind of civil war., And that is what I think is were at risk.

Of. After World War II, the United States outlined its dominance as a leading world power., Because other countries surrendered to the US peace followed the war.. This led to economic prosperity, as the countries work together to wipe out the debt built up from the world war.. However, as this prosperity occurred, the wealth gap began to expand..

Now the US in relation to China is behind on several metrics, including financials currency power, internal disorder and education.. Regarding financials US treasury bonds are currently in a humongous bubble. Investors in US 10-year Treasury Bills would only receive a return of 1.5 % per year, which is substantially lower than the inflation rate of over 6 %. Even if we assume an inflation rate of 3 % per year over the next decade, bond investors would still lose 1.5 % per year in inflation.

Adjusted returns, also known as real returns. Ray Dalio, believes that the Fed is now trapped in the making one of two decisions to raise interest rates in order to stop inflation or print more money to keep the economy running.. Both of these actions are not only financially detrimental but also hurt the purchasing power of the US dollar.. This is risky because the US dollar is currently the reserve currency, but that may change going forward..

If the US dollar loses its purchasing power, then another currency could step up, bringing the country immense financial power instability.. Earlier in this video, we talked about how the internal disorder in the US is a major concern, and that's because such internal tension could lead to a civil war.. A civil war can actually be beneficial if the war leads to revolutionary changes, which is called the productive civil war.. However, a civil war more commonly leads to disruptive conflicts., Perhaps the most important factor of them all is.

Education.. Dalio sees this as a key indicator for any country's long-term success.. China is improving its education, while America is slowly losing its education advantage, which is evident from test scores.. This could lead to serious disadvantages over the long term.

A rising world power like China is usually positive for the world, but Dalio sees America's disadvantages as signals for the collapse of the American empire.. This is because the risk lies not in other countries, but in America battling itself., So the financial is a concern.. The internal order disorder is a concern.. Then, if you look at education levels, the United States is losing its educational advantage..

If you were to look at compare it with China, if you take general public education in the United States, it's deteriorated tremendously. And even in comparison to developed countries, there are scores, PSET scores and so on, and that's something like 38th in the world or something., And That was a big plunge average public education. - If you look at the best universities in the world, the United States is unique in having the best universities in the world.. So there are these privileged spots that are excellent, uniquely excellent..

So when you look at the comparison, education in China is improving rapidly and it and the quantity is a quantity of educated people in the areas that they're moving in are, is greater. And the resources that they're putting behind it is greater.. And so you see, the results are greater, but it's sort of along the lines that I'm dealing with.. If you were to follow through in terms of actual productions, I think in terms of technologies, there are some areas that the United States is in a lead at the moment..

There's some areas that China's in a lead, but China's gaining very quickly.. When I first went to China 1984, I would bring $ 10 calculators. And I gave them away as gifts to high ranking people. And they thought they were miracle devices.

Right now in terms of areas like quantum computing and AI and many areas, you have a race Going on., And so, if you take the trajectory of the competitiveness, not just look at the current level, you have a situation where they're improving at a much faster rate.. This is all good for the world if the world can get along., And the main thing, I think, is how do you have a healthy world? And how do you have a strong economy? And how do you have a strong situation is be strong.. The United States's war is with itself. The reason why Ray Dalio is so confident in his predictions is because he is tracking statistics that become concerning before almost every downturn..

In that sense, the collapse of America may have already happened, but you just don't know yet. Everything that happens has reasons causes that proceeded it that made it happen. And so by having all those in numbers, one can see the probabilities of certain things happening.. So that's what you see in the book., It's not just Ray's interpretation.! I didn't wan na make it Ray's interpretation'cause.

I don't know if I'm right., So there you have it. Ray Dalio's prediction of America's impending financial crisis.. Do you agree with Ray Dalio? Let me know down below. If you enjoyed this video, please hit the like button and subscribe.

And I'll see you in the next one.