What Ray Dalio Thinks of Donald Trump and the Economy | Exploring Markets

What Ray Dalio Thinks of Donald Trump and the Economy

Ray Dalio recently published a post about Donald Trump, what he thinks, and how his presidency might impact financial markets. Three things in his post stand out. We've highlighted them all below.

First, his thoughts about who Trump might compare to:
"As far as the ideology part of that assessment goes, we believe that we will have a profound president-led ideological shift that is of a magnitude, and in more ways than one, analogous to Ronald Reagan’s shift to the right. Of course, all analogies are also different, so I should be clearer. Donald Trump is moving forcefully to policies that put the stimulation of traditional domestic manufacturing above all else, that are far more pro-business, that are much more protectionist, etc." - Ray Dalio
 Second, here are Dalio's thoughts about how the global economy could respond:
"... As a result, whereas the previous period was characterized by 1) increasing globalization, free trade, and global connectedness, 2) relatively innocuous fiscal policies, and 3) sluggish domestic growth, low inflation, and falling bond yields, the new period is more likely to be characterized by 1) decreasing globalization, free trade, and global connectedness, 2) aggressively stimulative fiscal policies, and 3) increased US growth, higher inflation, and rising bond yields." - Ray Dalio
And lastly, it may not be as bad as the headlines make it out to be:
"So, what are we trying to say? The headline is that the ideological/environmental shifts are clear, their magnitudes will be large, and there’s a good chance that the “craziness” factor will be smaller and play a lesser role in driving outcomes than many had feared. In fact, it is possible that we might have very capable policy makers of the previously mentioned ideological persuasion in control." - Ray Dalio
Now you need to go read the entire post, which is on LinkedIn, here.