Lintao Zhang/Getty Images
- Billionaire Ray Dalio warned on Thursday that the US and China are on the precipice of war.
- And the two giants are threatening to drag the rest of the world down with them, Dalio said.
- The 2024 US election is only going to make relations between both powers worse, he added.
The US and China are on the brink of war, warned billionaire and renowned China investor Ray Dalio.
Both sides are at severe risk of crossing each other's red lines, and diplomacy between them is clearly failing, Dalio wrote in a Thursday memo on LinkedIn.
"The United States and China are on the brink of war and are beyond the ability to talk," reads Dalio's grim message.
Dalio, who runs the biggest foreign hedge fund in China and has 40 years of experience investing in the country, said he penned his thoughts after recently meeting with policymakers, Chinese citizens, and China experts from around the world.
The billionaire fears conflict will escalate over several immediate flash points — quarrels over Taiwan, confrontations between American and Chinese aircraft and ships, the war in Ukraine, and threats of economic sanctions.
While China and the US know they need to deconflict, "there is growing belief that the unavoidable trajectory is toward war," Dalio said.
Washington and Beijing are showing they aren't able to talk these issues out, he added. Whenever they interact with each other, "discussions about big, important things have become exchanges of accusations that worsen relations rather than help them," he wrote.
So it's better if both sides don't try to discuss these issues at all, Dalio suggested.
The 2024 US election will also worsen tensions, Dalio predicted. Politicians seeking reelection will likely try to keep pushing limits with Beijing to appeal to anti-China sentiment from voters, said the billionaire.
"The hawkish political influences in the United States will exert more pressure on the relationship over the next 18 months because of the emergence of the 2024 election season," Dalio wrote. "That will be a very risky period because China and the US are now already on the brink of war."
An additional risk is that US leadership is "fragmented" in how it projects anti-China stances, Dalio said. He cited then-House Speaker Nancy Pelosi's August visit to Taiwan. Chinese leader Xi Jinping had personally asked President Joe Biden to block the trip, but Biden said he had no control over Pelosi's foreign diplomacy, The Washington Post reported.
And as both powers look to protect their sources of essential technologies and minerals, they're making countries around the world choose sides, Dalio warned further.
He cited the US seeking to stop South Korean chip producers from increasing sales to China if Beijing sanctions the Idaho-based Micron Technology.
Dalio also pointed to Saudi Arabia — traditionally a US ally — recently engaging in new deals with China and Russia, and French President Emmanuel Macron criticizing Washington for provoking China.
The US and China, he said, are "like two giants wrestling with each other six inches from the edge of a cliff and threatening to pull others into this dangerous fight."
"All things considered, I think that the greater provocations will most likely come from the American side, which I worry will cause a tit-for-tat crossing of the line," Dalio wrote.
Still, he doesn't believe those grievances will push China to declare war soon, or even in the next three years.
"I want to emphasize that by saying that they are on the brink, I don't mean to say that they will necessarily go over the brink," Dalio wrote.
The billionaire recommended several steps to de-escalate tensions. This included having Biden host Xi in San Francisco at the November APEC meeting, and sending key US policymakers and congressional leaders to visit China.
"Have all parties make clear that peace is better than war," Dalio said. "That working on agreeing on ways to reduce the probabilities of having the worst types of wars is a top priority, and that gradually building agreements to reduce the progressively less bad types of conflict would be the best path."
from Business Insider https://ift.tt/pOz8jCM
via IFTTT https://href.li/?https://bit.ly/smartgadgets- https://href.li/?https://bit.ly/smart_gadgets https://href.li/?https://bit.ly/modern_gadgets https://href.li/?https://bit.ly/kitchen_toods
No comments:
Post a Comment