Billionaire investor and Bridgewater Associates founder Ray Dalio believes the Middle East is fast emerging as one of the world’s most powerful AI hubs, as per a CNBC report.

Speaking to the channel on 8 December, Ray Dalio compared the Middle East’s momentum to the rise of Silicon Valley’s tech dominance, noting that the United Arab Emirates (UAE) and other Gulf nations are pushing large-scale investments in the AI space to attract global talent.

“What they’ve done is to create talented people. So this [region] is kind of becoming a Silicon Valley of capitalists. So now people are coming in, money is coming in, talent is coming in. There’s a buzz here, the way there’s a buzz in San Francisco, places like that, about AI or technology. It’s very similar to that,” Ray Dalio said.

Why Ray Dalio doesn’t see AI bubble as a big problem

When asked about artificial intelligence (AI) led stocks being in bubble territory, Ray Dalio said that investors should not rush to exit the sector, expressing an optimistic view of the technology and sector performance in the long term.

“All the bubbles took place in times of great technological change. You don’t want to get out of it just because of the bubble. You want to look for the pricking of the bubble,” he told the channel.

The billionaire added that investors can usually find the catalyst for “pricking” during a tightening of money or a forced need to sell wealth to meet obligations.

This comes amid admission of a possible AI bubble from Alphabet and Google chief Sundar Pichai, and ChatGPT-maker OpenAI’s Sam Altman, and multiple warnings about overvaluations that could crash over the next two years, from ‘The Big Short’ fame Wall Street legend Michael Burry. Notably, SoftBank’s Masayoshi Son, Nvidia’s Jensen Huang and Alibaba’s Eddie Wu have dismissed such concerns.

Global economy ‘precarious’, says Ray Dalio

Meanwhile, the investor warned of stress in commercial real estate, private equity, and venture capital, and expressed concerns about the global economy over the next two years amid what he flagged as “convergence of three dominant cycles” — debt, geopolitics, and US political conflict.

He pointed to similarities between the bubble in 2000, stating, “The next year or two in the future is going to be more precarious. We’re seeing cracks in the markets in a number of ways, private equity, venture capital, debt that’s being refinanced, and all of those. So we are in a bubble, I believe, by almost all of those measures.”

Going into 2026, Ray Dalio also warned of political disruption in the US. “As we go into the 2026 elections, you will see a lot more conflict in different ways. Every country cannot continue to accumulate the debt they have, yet politically, they can’t raise taxes and they can’t cut benefits. So they’re stuck. We now have populism of the left and populism of the right, which means irreconcilable differences,” he added.