When you reach the part of the cycle that you have to borrow money to pay debt service, and the holders of those bonds say it’s a risky situation — in the private debt market, we call that the debt death spiral,

Billionaire hedge fund manager Ray Dalio has a bearish outlook on the US economy, citing the escalating debt crisis as the Trump administration attempts to wrangle an annual deficit that topped $1.8 trillion in fiscal 2024 alone.

Ray Dalio, the billionaire founder of hedge fund Bridgewater Associates, has a warning for the Trump administration: commit right now to reducing the deficit or risk a major debt crisis within three years.

Bridgewater founder Ray Dalio compared the US debt to plaque building up in a heart, and said it was vital to act before the situation worsens.