Every quarter, I’ll update the economic apartment forecasting that both Ray Dalio, Warren Buffett and George Soros have on the economy.
Ray Dalio has been analyzing China for 36 years. Dalio believes the current state of the US resemble the late 1930s prior to World War II. Interestingly, there was no major stock market crash in the late 1930s and 1940s.
This time the US is like Europe in the late 1930s and China is like America was in the 1930s. The US like Europe in the late 1930s will feel a lot of pressure to sell bonds and also Dalio believes that the Feds will have limited power to save the economy. He forecasts a flight where capital flees the US but capital restrictions will block it from China.
The world is now divided between countries that have to decide to side with the US or China. If a country needs military protection, they side with the US. If a country needs economic stimulus, they side with China.
In a financial or military crisis, the President of the US will use it’s emergy powers to cut off capital flows to China, freeze payments on debt owed to China and apply sanctions.
Warren Buffet raised eyebrows when he bought 21 millions of Barrick Gold worth $563 million while selling Wells Fargo, JPMorgan and Goldman stakes. This is the same Buffett who said about gold just a few years ago, “It has no utility. Anyone watching from Mars would be scratching their head.”
George Soros holds the view that Trump has been manipulating the economy to win the 2020 election including the 2017 Tax Cuts and Jobs Act. Soros was correct about a devaluation of the pound, an Iranian regime change, the Argentina debt payoff, a bitcoin collapse and a Democrat win in the House elections. He has not been right yet about a collapse in the European economy and on China.
“That crisis never ended. It just moved in different forms, travelled from one continent to another. But nevertheless it has always been with us. The world never went back to some kind of equilibrium after 2008,” says Soros. “What coronavirus has done, it has deepened and accelerated this never-ending non-stop crisis that began in 2008.”
The “Big 3” Report on the economy will always come out on the second Monday of each month. If you’d like to learn more about apartments, join our free Facebook group at www.facebook.com/groups/rediversify.