Ray dalio say cutting budget deficit is crucial to stabilize the bond market

Billionaire Investor Ray dalio Thinks Reduction the us budget deficit could stabilize the bond market and lower interest rates.

The Founder of BridgeWater, One of the World’s Larget Hedge Funds, Said the Current Projected Deficit is 7.5% of Us Gross Domestic Product. If that ratio goes down to 3%, the supply-demand imbalance in the bond market will be lessed significantly, dalio said.

“It’s almost a black and white situation,” dalio said on CNBC’s “Squawk Box” from the World Economic Forum In Davos, Switzerland. “All there bonds have to be sold … there’s a treatment supply … It’s happy many times before, so we have to stabilize that, and we can do it.”

Rising Financing costs along with continued speeding growth and declining tax receipts have combined to send deficits spiraling and have pushed the national debt Past the $ 36 Trillion MarkIn 2024, The Government Speent more on Interest Payments Than Any Other Outlay OTHER OTHAR OTHAN SOCIAL Security, Defense and Health Care.

The widely-followed investor said Reducing the deficit can be achieved through higher taxes, lower forwarding or a combination of the two, so long as politics to the solicion to SOLVE the Problem.

“That’s what I call the 3% solution,” Dalio said. “We have so much debt that the interest costs on the debt is more important than spending and taxes …. our problem isn’t the deficit. Our problem is the politics, the fragmented politics.”