Dalio's Latest Remarks: Current Situation Similar to Early 1970s, Investors Should Overweight Gold

At the Greenwich Economic Forum held on Tuesday, Dalio agreed with the view that "gold currently has safer-haven attributes than the US dollar" and suggested investors consider allocating 15% of their portfolios to gold.

Dalio stated: "In August 1971, I was working on the floor of the New York Stock Exchange when Nixon announced, 'You can't get your money back' (the U.S. abandoned the gold standard). At the time, I thought this would be a huge crisis and the stock market would plummet, but instead, it soared. I studied history and found that exactly the same thing happened in March 1933—in other words, devaluing the dollar."

Dalio added that when we discuss the rise and fall of asset prices, we view them from the perspective of currency, but the value of the currency itself also fluctuates. Therefore, it makes perfect sense that while stock markets are repeatedly hitting new highs, gold is also reaching new highs. Currency is supposed to serve both as a medium of exchange and a store of wealth. However, under the current conditions of massive debt and debt supply, currency is not an effective store of wealth, so it is natural to turn to another form of storing or holding wealth. The most fundamental hard currency is gold—the only asset people can hold without relying on others for fulfillment.

Undoubtedly, Dalio's advice differs entirely from conventional financial thinking. In the classic "60% stocks + 40% bonds" allocation logic, because gold does not generate interest, investors are typically advised to keep their allocation in single-digit percentages.

He also emphasized that for investors holding U.S. dollars, it is first necessary to clarify what the real value of the dollar is. The real return assets you hold operate primarily based on a credit system. Once the credit environment changes, it triggers a series of chain reactions. Therefore, gold is not only an effective diversification tool but also well-timed for allocation now.

Incidentally, Dalio also mentioned in the interview that he has allocated more to the U.S. market than necessary, so he will next invest in Chinese (assets). Both markets face their respective challenges and have their own advantages. Currently, asset prices in many markets are quite expensive, but the situation in China is different, with some assets being relatively less expensive.