Key Takeaways
- Famed investor Ray Dalio said it’s time to reconsider your safe-haven assets in light of recent government policies and economic changes.
- He advises investors to allocate 10% to 15% of their portfolios to gold.
- Dalio says that the primary risk for Treasury holders will be from continued money printing by the U.S. Federal Reserve.
Dalio is raising a red flag on Treasurys, telling those at a launch event for Abu Dhabi Finance Week that he is instead buying gold as his preferred safe haven. He argued that Treasurys are no longer the most secure investment due to the ballooning U.S. national debt, now north of $37 trillion, with the annual budget deficit getting close to $2 trillion.
Dalio is leading by example, as his fund, Bridgewater Associates, invested $319 million in SPDR Gold Shares (GLD) during the first quarter of 2025. (In the summer of 2025, he sold his remaining shares in the fund he made famous.)
Why Dalio Sees Risks in US Treasurys
Dalio recently took to X to give a detailed analysis of why Treasurys are not as safe as once thought. After Moody’s announced a downgrade of the U.S.’s sovereign debt from Aaa to Aa1 in May 2025, he wrote, “You should know that credit ratings understate credit risks because they only rate the risk of the government not paying its debt. They don’t include the greater risk that the countries in debt will print money to pay their debts, thus causing holders of the bonds to suffer losses from the decreased value of the money they’re getting.”
Dalio likened the mounting debt burden to clogged arteries: As more of the U.S. government’s revenue goes toward paying interest, other areas suffer, potentially triggering a sharp economic slowdown—or a “heart attack.” If that happens, Treasurys, long considered the safest asset worldwide, would quickly lose their appeal.
Gold Steps In
Gold, by contrast, has historically retained value or appreciated during such periods. As a store of value and inflation hedge, those bullish on gold argue that it’s the only investment that is not a liability to someone else. And it has no counterparty risk, protecting its holders from the whims of governments and central banks.
Dalio’s Advice
Dalio suggested that investors reassess the traditional portfolio mix of 60% stocks and 40% bonds. As government spending is at least 40% higher than its revenues, the primary way it will pay off the debt is by the Federal Reserve printing money for the government to pay the interest on Treasury bonds, he said.
Even with gold prices reaching more than $3,600 an ounce, he recommends most investors allocate 10% to 15% of a well-diversified portfolio to gold.
Tip
To invest in gold, you have several options, including buying the physical stuff in the form of coins, bars, or even jewelry, but that means dealing with storage, insurance, and the risk of theft or loss. A more accessible route is through gold exchange-traded funds,…
Read More: Ray Dalio Urges Investors To Prioritize Gold Over Treasurys for Stability
