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Ray Dalio: “I’m afraid investors may be in a slump like in 2008.”

‘I am trying to imagine how this will play out’, says head of world’s largest hedge-fund of market reaction to coronavirus

Ray Dalio on Monday painted an uncertain picture for the economy after the Federal Reserve took extreme measures to limit the economic fallout from the spread of COVID-19, which has delivered a crushing blow to a number of industries and threatens to throw the global economy into a recession.

“The coronavirus was the thing to cause the downturn, which surprised me,” he wrote in a note. “While it is an extremely serious infectious disease and that will produce many harmful economic impacts, these things alone don’t scare me; however, when combined with long-term interest rates hitting the hard 0% floor, that really worries me,” he wrote.

Dalio wrote that assistance needs to come from governments, and not central banks:

He noted that the U.S. House of Representatives will vote this week on a set of targeted measures. Those include free testing for the virus, expanded unemployment insurance and paid sick leave, among a number of other measures.

“But these measures will be relatively small and offer modest support to those with economic problems. They will need to be much bigger,” he wrote.

The hedge-fund manager oversees some $160 billion in assets at

“We’re disappointed because we should have made money rather than lost money in this move the way we did in 2008,” he told the publication.

On Monday, he said he feared that investors may see a 2008-syle collapse of companies as the pandemic roils the market. “I’m seriously concerned by what I see which is that a number of companies and industries will have to debt problems that will likely lead to restructurings,” Dalio wrote.



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