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The founder of Bridgewater Associates, one of the world\u2019s largest hedge funds, has voiced concern that President Donald Trump\u2019s economic agenda could lead to \u201csomething worse than a recession.\u201d<\/p>\n
\u201cRight now, we are at a decision-making point and very close to a recession,\u201d billionaire investor Ray Dalio told NBC\u2019s Meet the Press last year. \u201cAnd I\u2019m worried about something worse than a recession if this isn\u2019t handled well (1).\u201d<\/p>\n
A recession is typically defined as two consecutive quarters of negative GDP growth. A much more \u201cprofound\u201d change would be a breakdown of the current monetary order. These kinds of forward-looking assessments are something Dalio has some amount of experience with, having correctly predicted the 2008 financial crisis.<\/p>\n
To be sure, a recession is bad news. However, what Dalio is sounding the alarm over could be much worse financially for the average American \u2014 the upheaval of a U.S. backed global monetary system.<\/p>\n
Trump has triggered global economic chaos with his on-again, off-again \u201creciprocal\u201d tariffs (2). But Dalio fears something worse \u2014 the U.S. could end up isolated as its biggest trading partners sign cross-border agreements that exclude the world\u2019s largest economy.<\/p>\n
\u201cBy and large, it\u2019s changing the world order in a way which is making it more inefficient and actually causing growth around the United States,\u201d Dalio said during a Paley Media Council event last year (3).<\/p>\n
The end of World War II ushered in a new monetary and geopolitical world order. But history tends to repeat itself. Tariffs, combined with a high level of debt and a rising superpower challenging the existing superpower, could lead to \u201cprofound changes\u201d in the world order.<\/p>\n
\u201cSuch times are very much like the 1930s,\u201d Dalio told NBC.<\/p>\n
\u201cThese go in cycles that can be measured, and I worry about the breakdown of that kind of order, particularly since it doesn\u2019t need to happen,\u201d he noted, adding that there are better ways to restructure debt.<\/p>\n
Whether tariffs are implemented in a \u201cstable\u201d way or a \u201cchaotic and disruptive way\u201d can make \u201call the difference in the world,\u201d he said. But so far, the tariffs have been akin to \u201cthrowing rocks into the production system.\u201d<\/p>\n
Or, in other words, highly disruptive.<\/p>\n
Read More: Robert Kiyosaki warned of a ‘Greater Depression’ \u2014 with millions of Americans going poor. Was he right?<\/a><\/p>\n Despite Dalio\u2019s warning, recent data suggests the U.S. economy continues to grow. Real GDP increased by 2.1% in 2025 (4), though there are still signs of concern.<\/p>\n According to Bureau of Labor Statistics data, the U.S. had almost no job growth last year. Employers added just 181,000 jobs in 2025 \u2014 an 88% decrease from the 1.46 million jobs added in 2024 (5).<\/p>\n The good news is that hiring has picked up this year, with 178,000 new jobs in March. Job gains have occurred in health care, construction, transportation and warehousing, and social assistance, while federal government employment continues to decline (6).<\/p>\n As of March, the unemployment rate is at 4.3%. The rate hasn\u2019t dipped below 4% since May 2024 (7).<\/p>\n While this is far from ideal, it\u2019s not at the level of the Great Depression in the 1930s, as Dalio suggests, when nearly a quarter of America\u2019s labor force couldn\u2019t find employment.<\/p>\n However, the war in Iran is another complicating factor for the economy, leading to the biggest jump in U.S. inflation in nearly four years (8). Consumer prices rose 3.3% in the 12 months ending in March, largely fueled by a spike in energy costs (9).<\/p>\n Even if the powers that be make a permanent deal to end the conflict, the effects will likely be felt in the economy for months to come.<\/p>\n So it\u2019s no surprise that consumer sentiment fell to a record low in April \u2014 and that Americans\u2019 perceptions of their current financial situation matched the worst since 2009 (10).<\/p>\n If you\u2019re an average American, how can you heed Dalio\u2019s warnings about the dire consequences of Trump\u2019s economic agenda?<\/p>\n You can start by establishing an emergency fund (if you don\u2019t already have one) that will cover at least three to six months of expenses \u2014 perhaps more if you\u2019re in a job that could be impacted by tariffs, trade wars and soaring transportation costs.<\/p>\n Here are five more practical tips to hedge against an uncertain financial future.<\/p>\n It\u2019s a good idea to pay down high-interest debt (like credit cards) and avoid building up more debt, if possible. If you have a great deal of high-interest debt to get rid of, consider tapping into your home\u2019s equity through a Home Equity Line of Credit (HELOC).<\/p>\n A HELOC is a revolving line of credit that leverages the equity in your home as collateral so you can borrow and repay funds as needed \u2014 similar to a credit card.<\/p>\n AmeriSave<\/a> offers a flexible HELOC that lets homeowners borrow against their equity as needed during a draw period, making it useful for renovations or debt consolidation. The application is primarily online and available in most states.<\/p>\n It\u2019s a good fit for borrowers who want convenience and flexibility rather than a large lump-sum loan up front. You can draw funds only when you need them, so it\u2019s useful for ongoing or unpredictable costs. Interest is charged only on what you use, and you repay the balance over time. It\u2019s essentially a flexible credit line secured by your home, delivered through a mostly online application process<\/a>.<\/p>\n After you\u2019ve taken care of your emergency fund and high-interest debt, it\u2019s time to get serious about sticking to a budget \u2014 but it doesn\u2019t have to be complicated.<\/p>\n A quick daily check-in of your accounts can show you exactly where your money is going.<\/p>\n An app like Rocket Money<\/a> can easily flag recurring subscriptions, upcoming bills and unusual charges by pulling in transactions from all your linked accounts.<\/p>\n This can help you cut unnecessary costs, and then you can manually redirect savings straight into your retirement fund. No spreadsheets, no guesswork, no stress. Small habits like this can make a big difference over time.<\/p>\n Rocket Money\u2019s intuitive app<\/a> offers a variety of free and premium tools. Free features include subscription tracking, bill reminders and budgeting basics, while premium features \u2014 like automated savings, net worth tracking, customizable dashboards and more \u2014 make it easier to stay on top of your retirement contributions and overall financial goals.<\/p>\n It may also be a good time to diversify your investments across different asset classes to mitigate risk. That might mean adjusting your mix of stocks, bonds and other assets.<\/p>\n If you\u2019re close to retirement, you might want to shift to lower-risk assets, like dividend-paying stocks. Alternative investments, such as gold and real estate, are often considered a hedge against inflation and recession.<\/p>\n In fact, gold was worth more than 58 times as much in 2016 as it was in 1910 \u2014 over 100 years ago (11). And that\u2019s before the precious yellow metal went on a historic bull run in 2025.<\/p>\n One way to invest in gold that can also offer significant tax advantages is to open a gold IRA with the help of Priority Gold<\/a>.<\/p>\n Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold<\/a> \u2014 making it an attractive option for those looking to potentially hedge their retirement funds against economic uncertainty.<\/p>\n To learn more, you can get a free information guide that includes details on how to get up to $10,000 in free silver<\/a> on qualifying purchases. Just keep in mind that gold is often best used as one part of a well-diversified portfolio.<\/p>\n Rental properties have long been a proven source of steady, passive income for high-net-worth investors \u2014 so it\u2019s no wonder that real estate accounts for nearly 25% of the typical family office portfolio (12).<\/p>\n You can tap into this market through real estate crowdfunding platforms like Arrived<\/a>.<\/p>\n Backed by world-class investors, including Jeff Bezos, Arrived allows you to invest in shares of vacation and rental properties<\/a>, earning a passive income stream without the extra work that comes with being a landlord of your own rental property.<\/p>\n To get started, simply browse through their selection of vetted properties<\/a>, each picked for their potential appreciation and income generation. Once you choose a property, you can start investing with as little as $100, potentially earning monthly dividends.<\/p>\n If you\u2019re new to hedging \u2014 a risk management strategy that can help offset losses by purchasing investments in an opposite position to an existing investment \u2014 you may want to consult with a financial advisor to see how this could help mitigate risk in your portfolio.<\/p>\n Advisor.com<\/a> can help you find a licensed financial professional who\u2019s right for you.<\/p>\n The platform does the heavy lifting for you, vetting advisors based on track record, client ratios and regulatory background. Plus, their network comprises fiduciaries, who are legally required to act in your best interests.<\/p>\n Just enter a few details about your finances and goals, and Advisor.com\u2019s AI-powered matching tool will connect you with a qualified expert<\/a> best suited for your needs based on your unique financial goals and preferences.<\/p>\n From there, you can set up a free initial consultation<\/a> with no obligation to hire to see if they\u2019re the right fit for you.<\/p>\n Depending on whether you\u2019re close to retirement or not, you may want to adjust your retirement strategy \u2014 and adjust your risk tolerance to match that strategy. If you\u2019re a young investor, you still have time for the market to recover, so avoid panic selling.<\/p>\n – With files from Jing Pan<\/p>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.<\/a><\/p>\n NBC News (1<\/a>), (5<\/a>); The Guardian (2<\/a>); Observer (3<\/a>); Bureau of Economic Analysis (4<\/a>); Bureau of Labor Statistics (6<\/a>), (7<\/a>), (9<\/a>); Bloomberg (8<\/a>), (10<\/a>); United States Gold Bureau (11<\/a>); Knight Frank (12<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. 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