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It\u2019s been more than 160 years since America\u2019s last civil war \u2014 but billionaire investor Ray Dalio is warning that another one may be brewing.<\/p>\n
In a recent interview on Leaders with Francine Lacqua, Dalio was confronted with a blunt question: \u201cCould we be close to another world war?\u201d<\/p>\n
He didn\u2019t hesitate. \u201cWe are in wars,\u201d Dalio replied. \u201cThere is a financial money war, there’s a technology war, there’s geopolitical wars and there are more military wars.\u201d (1)<\/p>\n
Then came his more unsettling assessment: the U.S. itself isn\u2019t immune.<\/p>\n
\u201cWe have a civil war of some sort, which is developing in the United States and elsewhere, where there are irreconcilable differences,\u201d Dalio said.<\/p>\n
He outlined two paths the country could take.<\/p>\n
The first, more hopeful scenario is one in which Americans \u201crise above it and realize that our common good is going to necessitate us dealing with it so that what works for most people is going to work.\u201d But as he admitted, that may be \u201ca little bit idealistic.\u201d<\/p>\n
The second is far bleaker: \u201cI think that these conflicts will become tests of power by each side.\u201d<\/p>\n
It\u2019s a stark warning \u2014 especially from someone who also cautioned earlier in the interview that \u201cour power to hurt each other has never been greater.\u201d<\/p>\n
This isn\u2019t the first time Dalio has sounded the alarm about America\u2019s internal fractures. In a recent post on X, he wrote: \u201cFrom studying 50-plus civil wars and revolutions, it became clear that the single most reliable leading indicator of civil war or revolution is bankrupt government finances combined with big wealth gaps.\u201d (2)<\/p>\n
And the U.S. is edging dangerously close to that description.<\/p>\n
The national debt has climbed to $37.92 trillion, with a debt-to-GDP ratio of 125%, up from 100% a decade ago. Dalio has warned that when debt rises relative to income, it\u2019s like \u201cplaque in the arteries\u201d \u2014 eventually choking off spending. (1)<\/p>\n
Meanwhile, wealth inequality has ballooned. The wealthiest 1% of Americans now hold 31% of the nation\u2019s net worth \u2014 up from 22.8% in 1989. (3) By contrast, the bottom 50% watched their share shrink from 3.5% to just 2.5% over the same period, Federal Reserve data shows. (4)<\/p>\n
Those widening gaps \u2014 combined with rising fiscal strain \u2014 are precisely the kind of warning signs Dalio says often precede civil wars and revolutions.<\/p>\n
If his warning has you on edge and wondering how to protect your wealth in turbulent times, it may be worth considering assets that can help weather a crisis.<\/p>\n
Read more: Warren Buffett says you can\u2019t buy time \u2014 but landlords are finding a way. Here\u2019s how savvy real estate investors are avoiding 12 hours a month in tedious admin (for free)<\/a><\/strong><\/p>\n Amid his dire forecasts, Dalio has repeatedly emphasized the importance of diversification \u2014 and singled out one time-tested asset as a cornerstone of a resilient portfolio: gold.<\/p>\n \u201cPeople don’t have, typically, an adequate amount of gold in their portfolio,\u201d he told CNBC earlier this year. \u201cWhen bad times come, gold is a very effective diversifier.\u201d<\/p>\n He doubled down on that view more recently at the Greenwich Economic Forum, calling gold a \u201cvery excellent diversifier in the portfolio.\u201d<\/p>\n \u201cIf you look at it just from a strategic asset allocation perspective, you would probably have something like 15% of your portfolio in gold \u2026 because it is the one asset that does very well when the typical parts of the portfolio go down,\u201d Dalio explained.<\/p>\n Long viewed as the ultimate safe haven, gold isn\u2019t tied to any single country, currency or economy. It can\u2019t be printed out of thin air like fiat money and in times of economic turmoil or geopolitical conflicts, investors tend to pile in \u2014 driving up its value.<\/p>\n Over the past 12 months, gold prices have surged by more than 50%.<\/p>\n One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of Thor Metals<\/a>.<\/p>\n Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold, making it an attractive option for those looking to potentially hedge their retirement funds against economic uncertainties.<\/p>\n To learn more, you can get a free information guide that includes details on how to get up to $20,000 in free metals<\/a> on qualifying purchases.<\/p>\n Investing legend Warren Buffett has also offered clear money advice for politically-volatile times.<\/p>\n In 2014 \u2014 the last time Russia invaded Ukraine \u2014 Buffett told CNBC that \u201cthe last thing you’d want to do is hold money during a war,\u201d because in \u201cvirtually\u201d every conflict he\u2019s aware of, the value of money would go down. (5)<\/p>\n So what does he recommend owning when the world is on edge?<\/p>\n \u201cYou might want to own a farm, you might want to own an apartment house, you might want to own securities,\u201d Buffett said.<\/p>\n Indeed, real assets like apartment buildings have the potential to create returns through thick and thin. In fact, Buffett has repeatedly pointed to real estate as a prime example of a productive, income-generating asset.<\/p>\n In 2022, Buffett stated that if you offered him \u201c1% of all the apartment houses in the country\u201d for $25 billion, he would \u201cwrite you a check.\u201d (6)<\/p>\n Real estate also offers a natural hedge against inflation \u2014 a point that aligns with Buffett\u2019s warning about the erosion of money\u2019s value during wartime. When inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts with inflation.<\/p>\n Of course, you don\u2019t need billions \u2014 or even to buy an entire property \u2014 to invest in real estate. Crowdfunding platforms like Arrived<\/a> offer an easier way to get exposure to this income-generating asset class.<\/p>\n Backed by world class investors like Jeff Bezos, Arrived allows you to invest in shares of rental homes with as little as $100, all without the hassle of mowing lawns, fixing leaky faucets or handling difficult tenants.<\/p>\n The process is simple: browse a curated selection of homes that have been vetted for their appreciation and income potential. Once you find a property you like, select the number of shares you\u2019d like to purchase and then sit back as you start receiving any positive rental income distributions<\/a> from your investment.<\/p>\n Another option is Homeshares<\/a>, which gives accredited investors access to the $35 trillion U.S. home equity market \u2014 a space that\u2019s historically been the exclusive playground of institutional investors.<\/p>\n Homeshares allows accredited investors to gain direct exposure to a portfolio of owner-occupied homes in top U.S. cities through their U.S. Home Equity Fund<\/a> \u2014 without the hassles of buying, owning or managing property.<\/p>\n The fund focuses on homes with substantial equity, using Home Equity Agreements (HEAs) to let homeowners access liquidity without taking on debt or interest payments. This creates an attractive, low-maintenance investment vehicle for retirement savers, with a minimum investment of $25,000.<\/p>\n With risk-adjusted target returns of 14% to 17%, the U.S. Home Equity Fund offers investors access to America\u2019s largest store of household wealth.<\/p>\n And for a limited time, Homeshares will provide Moneywise readers an exclusive 5% bonus for IRA investments<\/a>.<\/p>\n It\u2019s easy to see why great works of art tend to appreciate over time. Supply is limited and many famous pieces have already been snatched up by museums and collectors. That scarcity also makes art an attractive option for investors looking to diversify and preserve wealth during periods of uncertainty and inflation.<\/p>\n In 2022 \u2014 shortly after U.S. inflation hit a 40-year high \u2014 a collection of art owned by the late Microsoft co-founder Paul Allen sold for $1.5 billion at Christie\u2019s New York, making it the most valuable collection in auction history. (7)<\/p>\n Investing in art was traditionally a privilege reserved for the ultra-wealthy.<\/p>\n Now, that\u2019s changed with Masterworks \u2014 a platform for investing in shares of blue-chip artwork<\/a> by renowned artists, including Pablo Picasso, Jean-Michel Basquiat and Banksy.<\/p>\n From their 23 exits so far, Masterworks investors have realized representative annualized net returns like +17.6%, +17.8% and +21.5% among assets held for longer than one year. Simply browse their impressive portfolio of paintings<\/a> and choose how many shares you\u2019d like to buy. Masterworks will handle all the details, making high-end art investments both accessible and effortless.<\/p>\n New offerings have sold out in minutes, but you can skip their waitlist here<\/a>.<\/p>\n See important Regulation A disclosures at Masterworks.com\/cd<\/a>.<\/p>\n Join 200,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/strong><\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.<\/p>\n @business (1<\/a>); @RayDalio (2<\/a>); Federal Reserve Bank of St. Louis (3<\/a>; 4<\/a>); @CNBC (5<\/a>); CNBC (6<\/a>); Christie\u2019s (7<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Getty Images Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.…\n","protected":false},"author":3,"featured_media":314153,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[64,62392,158166,7780,79,158165,4061,4326,67,132,68,4327],"class_list":{"0":"post-314152","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-civil-war","10":"tag-civil-wars","11":"tag-dave-ramsey","12":"tag-economy","13":"tag-francine-lacqua","14":"tag-jeff-bezos","15":"tag-ray-dalio","16":"tag-united-states","17":"tag-unitedstates","18":"tag-us","19":"tag-warren-buffett"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115396820547491881","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/314152","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=314152"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/314152\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/314153"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=314152"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=314152"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=314152"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}