Ray Dalio, founder of Bridgewater Associates, claims that market trends in 2026 will be determined by five key forces that are part of his concept of the “Great Cycle.”
The investor said the cycle includes economic, political and social upheavals. In this framework, Five central forces: debt and money. Domestic affairs. Geopolitics; Nature; and Technology.
For Dalio, these forces will be decisive for the evolution of markets and the distribution of wealth in 2026.
“What happens with currencies is very important to changes in wealth and what happens economically. When your currency depreciates, your wealth and purchasing power decreases, and your goods and services become cheaper in other currencies, and other people’s goods and services become more expensive in your own currency,” he explains.
In that sense, he emphasizes, “Thus, although there is some lag, it does affect inflation rates and who buys what from whom. Whether or not it is hedged against the currency is very important.”
“Great Cycle” and social and political factors
In addition to debt and money, Dalio noted that domestic politics plays an important role: “Economy, markets and politics are interconnected and mutually reinforcing each other in cycles.” In other words, The “Great Cycle” Dalio talks about is not driven solely by economic factors.
Regarding geopolitics and world order, he warned of structural changes: “In 2025 there will be a clear shift from multilateralism to unilateralism (where powers rule and countries act in their own interests).”
It added: “This has increased and will continue to increase the threat of conflict, and will lead to increased military spending and debt to finance it in most countries.”
Regarding natural phenomena, Dalio said, “Climate change continued to advance, but there was a politically driven change by Donald Trump to spend money and encourage energy production to minimize the problem.”
Finally, regarding technology, he highlights the impact of artificial intelligence. “When it comes to technology, the artificial intelligence (AI) boom, which is currently in the early stages of a bubble, has clearly had a huge impact on everything.”
This scenario is characterized by political tensions, rising debt, and structural changes. Bitcoin (BTC) appears to be a safe asset for many investors As CriptoNoticias explained, in the face of currency devaluation and loss of purchasing power.
(Tags to translate) Economy
