Ray Dalio's latest views and portfolio holdings have been revealed. Recently, the founder of the world's largest hedge fund, Bridgewater Associates, and billionaire Ray Dalio is conveying a simple yet unsettling message to markets brimming with soaring asset prices: wealth is merely a number unless it can be converted into cash you can actually spend. He stated that the current "wealth to money" ratio in the US is approximately 850%. This level is similar to peaks seen just before the 1929 financial crisis and the 2000 dot-com bubble burst. Concurrently, the latest disclosed US stock holdings report from Bridgewater shows a significant increase in bets on technology stocks and gold-related stocks in the fourth quarter, including NVIDIA, Amazon, and Micron Technology, alongside an increased stake in the global major gold producer Newmont. The five stocks with the largest reductions in holdings included Uber, Fiserv, Google, Meta, and Microsoft.
Dalio recently warned in an X post: "Wealth is worthless if it cannot be converted into spendable money. And when wealth is very large relative to the amount of hard money available—as we see today—bubbles are created." Dalio attached a clip from a recent episode of the podcast "What Is Finance?" hosted by Indian entrepreneur Nikhil Kamath, where he explained the distinction between "wealth" (which he described as nominal asset value) and "money" (spendable purchasing power). Dalio said that if you sell $50 million worth of stock at a $1 billion valuation, you are a paper billionaire, even though "nobody would put together a billion dollars for that stock." This gap between perceived wealth and actual cash is precisely what fuels bubble formation. Drawing parallels to the US boom of the 1920s and other episodes, Dalio argues that people feel richer as asset prices rise, but "if you don't sell the wealth, don't convert it into spending money, the wealth is worthless," a dynamic that has repeated throughout history.
Dalio indicated that the current US "wealth to money" ratio is about 8.5 to 1, meaning the ratio of financial assets to real money is approximately 850%. This level is analogous to peaks observed prior to the 1929 financial crisis and the 2000 dot-com bubble burst. He views this imbalance, coupled with widening wealth inequality and populist pressure for wealth taxes, as a key vulnerability that could potentially force asset sales and "burst" the bubble.
The world's largest hedge fund, Bridgewater Associates, recently disclosed its latest 13F filing, detailing its US equity holdings. Bridgewater increased its stakes in AI-focused stocks like NVIDIA, Amazon, and Micron Technology during the fourth quarter, as well as shares in Newmont, one of the world's largest gold producers. Furthermore, the total portfolio value reached $27.4 billion in Q4, a 7.4% increase from the previous quarter. The top ten holdings accounted for 36.33% of the total portfolio value, with positions in NVIDIA and Amazon seeing significant increases. The top five stocks Bridgewater bought in the fourth quarter were the SPDR S&P 500 ETF Trust (SPY), Micron Technology, Oracle, NVIDIA, and Newmont Corporation, one of the world's largest gold producers. However, within its top ten holdings, positions in Lam Research, Salesforce, Google, and Microsoft were reduced.
In his latest annual report and outlook, Dalio comprehensively examined the market dynamics and sources of return for the year. He believes the primary drivers of returns throughout the year were concentrated on two levels: firstly, changes in the value of currencies, including relative shifts between the US dollar, other fiat currencies, and gold; and secondly, the overall underperformance of US stocks compared to non-US markets and gold, with gold emerging as one of the best-performing major assets. He pointed out that this outcome is closely linked to fiscal and monetary stimulus policies, changes in productivity, and a significant global asset allocation shift away from the US.
Looking ahead, Dalio identified two key uncertainties: the direction of Federal Reserve policy and the extent of productivity growth. If nominal and real interest rates remain suppressed, it will support asset prices but could also foster bubbles. Interest rate cuts and credit easing have boosted prices of long-duration assets like stocks and gold, yet their valuations are no longer cheap. Less liquid assets, such as venture capital, private equity, and real estate, continue to face pressure, and as liquidity premiums compress, they risk future repricing. Dalio noted that US policy has clearly leaned capitalist-oriented, promoting manufacturing and AI industry development through fiscal stimulus, deregulation, and industrial support measures. However, these policies have also widened fiscal deficits and wealth inequality. Externally, heightened US sanctions and related actions have raised market concerns about escalating conflicts, further driving gold demand and asset diversification.
From a global perspective, the international order is gradually shifting from multilateral cooperation towards unilateralism. This change increases conflict risks and military spending, deepens protectionism and deglobalization trends, and also pressures the willingness of foreign capital to allocate to US dollar assets.