Billionaire investor Ray Dalio has launched an AI chatbot called ‘Digital Ray’ that allows users to interact with a digital version of himself. The announcement coincided with Dalio’s speech at the Greenwich Economic Forum, where he discussed potential risks related to the artificial intelligence bubble. Dalio stated the bot was created using his principles and decision-making criteria gathered over 35 years.
Dalio has been discussing five key forces that historically combine to reshape the world, including economic expansion, technological development, debt crises, political instability, and geopolitical conflicts. He sees parallels between the current environment and the 1920s and 1930s, citing concerns about debt levels in major economies, political polarisation, geopolitical tensions, and the unfolding AI revolution.
Addressing investment strategies amidst these challenges, Dalio advises caution regarding publicly traded and private credit due to tight credit spreads. While acknowledging the AI boom and its potential to inflate certain sectors, he suggests focusing on companies that effectively deploy AI to improve efficiency and profitability. He also recommends a US-centric approach to equities over China, citing concerns about capital flows and China’s debt situation.
Dalio advocates for a significant allocation to gold, suggesting it comprise around 15% of a portfolio. This contrasts with traditional advice that suggests a low single-digit percentage. He views gold as a crucial portfolio diversifier, particularly given the waning trust in institutions, the global order, and various financial instruments. Dalio emphasizes gold’s unique attribute as an asset that does not rely on another party for payment, reinforcing its appeal as a safe haven in uncertain times.
