Dalio warned that the United States is already very close to an economic downturn and that things could get even worse if not handled properly.

As President Donald Trump’s escalating trade war with tariff increases raises economic recession concerns in the United States, American billionaire investor Ray Dalio issued a warning that the U.S. economy could face something worse than a recession. Speaking to NBC, the hedge fund billionaire stated, “I think we are at a decision point right now and we are very close to a recession. I’m worried if it’s not handled well, something worse than a recession could happen.”

Dalio pointed out that a recession means two consecutive quarters of negative gross domestic product or a trend in that direction, stating, “These have always happened. Right now, something much bigger is at stake. We are facing a monetary order collapse. We will change the monetary order because we cannot spend money at these levels.” “HISTORY REPEATS ITSELF” Dalio’s statement came after the U.S. announced a 145% tariff on China, with China reciprocating with a 125% tariff on the U.S. Describing significant changes in the internal and global orders of the U.S., the billionaire, referencing the 1930s, said, “I have studied history; this is repeating over and over again. So, looking at tariffs, debt, the rising power that challenges the existing power, if you look at these factors, changes in orders, systems, these can be very destructive. The way we deal with this can create something much worse than a recession. Or it can be dealt with in a good way.”

Having accurately predicted a recession in 2008, Dalio mentioned that the current economic situation of the U.S. is at a “crossroads.” The billionaire suggested that the U.S. budget deficit could be reduced to 3% of the gross domestic product, but without action, it could reach approximately 7%.