Conversation with Ray Dalio: Why do I only trust gold and not Bitcoin?

整理 & 编译：Deep潮 TechFlow

Guest: Ray Dalio, Founder of Bridgewater Associates

Host: David Sacks

Podcast Source: All-In Podcast

Original Title: Ray Dalio: “AI Is Eating Everything - and It Might Eat Itself”

Air Date: March 3, 2026

Key Takeaways

In his third appearance on the All-In Podcast, renowned investor Ray Dalio delved into the severity of the U.S. debt crisis and made predictions about future developments. He discussed in detail the five major forces reshaping the global order, structural limitations faced by government efficiency sectors, the drivers behind gold reaching record highs, reasons for Bitcoin’s poor performance, and the real story behind tariffs and trade deficits. He also explained why he believes the U.S. may be nearing collapse.

Highlights and Insights

On the Nature of Debt and the Economy

Debt cycles are like the human circulatory system. When the cost of servicing debt relative to income keeps rising and becomes unpayable, it’s like plaque building up in arteries, squeezing out other expenditures.

On Structural Challenges in Government Reform

Making a highly efficient government even more efficient is very difficult. Attempting surgical reforms that are both effective and fast, without provoking too much opposition, is nearly impossible.

On the Underlying Logic of Money

Mechanically, money is fundamentally a form of debt. When you hold money, you’re holding a debt instrument—a promise that someone will give you currency. When central banks have excessive debt, their power is simply to print money.

On the Irreplaceability of Gold

Gold is the only long-term historical asset that can be transferred, cannot be mass-produced, and does not rely on others’ promises. In other words, most currencies, debts, stocks, etc., are just promises to exchange purchasing power.

On the Differences Between Bitcoin and Gold

Bitcoin lacks privacy; its transactions can be monitored and potentially controlled indirectly. Central banks are unlikely to want to buy or hold Bitcoin. Additionally, questions about new technological developments, such as quantum computing, potentially impacting Bitcoin, remain.

On Misconceptions About Tariffs and Inflation

Economists often make the mistake of not including taxes in inflation calculations. I mean, if your tax burden increases, that’s also inflation. Why should this impact you differently than rising home prices?

On the Three Keys to a Nation’s Success

First, educate children well. Second, society must provide an orderly, civilized environment. Third, avoid war. If these three are achieved, the country will succeed. History repeatedly proves this.

On the Endgame of Social Divisions

We are heading toward that “war,” and in fact, we are already in it. When the positions people support become more important than the system itself, the system faces crisis.

On the Paradox of AI “Eating Itself”

AI seems to be consuming everything, but it might “eat itself.” It may not generate enough profit… China might treat AI as a power infrastructure, offering it free to all. How do we compete in such a scenario?

On a Metaphor for the State of America

This is our problem—instant gratification and ignorance about whether certain things will boost productivity.

The Five Major Forces Shaping America’s Future

David Sacks: Looking back at the past year’s government policies, congressional actions, and economic performance, I want to ask: Are we on the right track? Or has there been little change compared to a year ago? Or are we moving too slowly?

Ray Dalio:

I’ve studied major economic cycles over the past 500 years, and five forces are intertwined, jointly determining the answer to your question. First is debt and monetary issues, which I will explain in detail later. Second is domestic polarization, including wealth and value gaps. These gaps lead to irreconcilable divides between left and right, affecting tax policies, democracy, and how everything functions. Third is great power conflicts—typical “rising powers challenge existing ones”—which alter the global order. Fourth is technological progress, which plays a key role in every cycle. Lastly, natural disasters—droughts, floods, pandemics.

When we talk about order, we refer to monetary order, which ultimately collapses for the same reasons. Similarly, all political orders—domestic and international—change over time. The U.S. political order has been relatively stable for 250 years but has experienced a civil war. Internationally, shifts are more frequent, such as the transition from unipolar to multipolar world, and technology constantly changing the landscape.

Given these factors, let me further explain the government’s fiscal situation and answer your question. A country’s economy functions much like a company or individual’s, except the government can print money. If we consider the government as a company or individual, its spending is about $7 trillion, with income around $5 trillion, resulting in a 40% deficit. The U.S. has been running deficits for a long time; current debt is six times income, which allows us to make predictions.

Debt cycles are like the human circulatory system—capital markets deliver credit to different parts of the economy. If this credit is used to increase productivity and generate enough income to service debt, it’s healthy. But when debt service costs relative to income keep rising and become unpayable, it’s like plaque buildup in arteries, squeezing out other spending.

Currently, the U.S. has a $2 trillion deficit, half of which is interest payments, plus $9 trillion in maturing debt to roll over. If this were a company or individual, it’s clearly problematic. To stabilize, a deficit of about 3% of GDP might be reasonable. But the current situation is very unhealthy—not only because it crowds out spending but also because of supply and demand issues in debt.

We need to roll over $9 trillion in maturing debt and sell an additional $2 trillion in new debt. Who are the buyers? Some are domestic, but about one-third are foreign. From their perspective, this situation is riskier.

First, dollar-denominated debt makes up a large part of their portfolios, possibly beyond prudent limits, plus geopolitical risks—imagine conflicts with China or tensions with Europe. Europeans might worry about sanctions affecting debt payments; the U.S. also needs to attract enough capital.

These scenarios have recurred throughout history—like from 1929 to 1945. So, this fiscal situation is unhealthy for the U.S., but larger issues are exacerbating it.

Why Government Reform Is Nearly Impossible

David Sacks: You previously mentioned this and suggested that reducing the deficit-to-GDP ratio to 3% could ease the impact. But that hasn’t happened. Last year, we had high hopes for Elon Musk leading efforts to improve government efficiency—cutting spending, fighting fraud, etc.

Do you think the failure of these reforms is because the actions themselves are flawed, or because the system is too entrenched to change at this stage? Is it because capital flows are too large, the economy overly dependent on them, and individuals and companies rely on this, making structural change impossible? Does this attempt tell us whether government reform is still feasible now?

Ray Dalio:

In a highly efficient government, making it more efficient is very difficult—especially when quick action is needed, due to election pressures. People generally dislike reforms, and you risk losing public support. In our society, whatever you do will be criticized and questioned. This raises the question: can democracy and our system support a leadership style that is both efficient and broadly acceptable?

For example, cutting spending often means reducing programs like school lunches. Attempting surgical reforms that are both effective and fast, without provoking too much opposition, is nearly impossible.

Historically, from a political or common-sense perspective, finding a leadership model that satisfies most people and can push reforms quickly is extremely challenging.

David Sacks: Recently, there was major news about potential widespread fraud in California’s public funds—some daycare centers that don’t exist received billions. Is this a symptom of the current cycle? How do you see this relating to our discussion?

Ray Dalio:

Yes, that’s a manifestation of this cycle. To have a well-managed government, you must ask: how well can the government manage? For example, visiting the DMV reveals how large, complex, and chaotic the system is. So, when you see such inefficiencies, are you surprised? Probably not.

Gold vs Bitcoin

David Sacks: You previously mentioned that your portfolio includes gold, which rose from $2,900 to $5,200 per ounce. How has gold performed over the past year? Is this because markets finally recognize the cycle phase you’ve discussed for years, or because China structurally abandoned the dollar and U.S. bonds, shifting more into gold? Or are other central banks also turning to gold? Or is there increased interest from individual speculators and market participants?

Ray Dalio:

This relates to major cycles. We need to understand that gold isn’t just a speculative metal as many think. It’s one of the oldest, most stable currencies, and the second-largest reserve asset held by central banks. For various reasons—economic supply and demand, political, geopolitical—central banks are buying gold to increase reserves. Also, individuals and other investors seek an alternative currency.

The key question is: what is money? Mechanically, money is debt. When you hold money, you’re holding a debt instrument—a promise that someone will give you currency. As I mentioned before, when central bank debt is excessive, their power is simply to print money. If you understand this, you see what’s happening now. The critical question is: David, what kind of currency do you think is safe?

David Sacks: I want a currency backed by assets, with real physical limits.

Ray Dalio:

Especially assets that can be transferred from one place to another. After all, money is both a medium of exchange and a store of wealth. If one government or central bank wants to pay another, it needs real currency—not fixed assets like buildings. To trade, you need something transferable. Gold is the only long-term historical asset that can be transferred, cannot be mass-produced, and does not rely on promises from others. Most currencies, debts, stocks are just promises to exchange purchasing power.

Wealth and money are different. Wealth can exist in stocks, buildings, companies, but you can’t spend wealth directly. To spend, you must convert wealth into money. Currently, the ratio of wealth to money is very high. The problem is, when you try to convert wealth into cash, they might choose to print money. Since the advent of fiat currency, this has been ongoing.

David Sacks: So, are market participants converting wealth or money into gold? How much room is there for growth in the gold market measured in dollars?

Ray Dalio:

I usually observe who holds what assets, including central bank holdings, and their composition. I look at the ratio of wealth to money, or wealth to gold. We see that relative to hard currency, total wealth and other currencies held by central banks are enormous.

Gold prices have risen from very low levels to higher ones, and this price increase, along with changes in asset composition, has nearly returned to historical averages, though not fully. Because the total wealth-to-money ratio remains high, this is still a major issue.

For example, wealth taxes are a potential risk. People ask: “Are we in a bubble?” like stocks related to AI or other speculative stocks. But bubbles are characterized by demand for money, which forces asset sales to meet that demand.

This demand often comes from borrowing to buy assets, pushing prices up. But this can’t last—assets must generate enough cash flow to cover debt service. Eventually, people start selling assets to pay debts or cash out for wealth taxes.

Whether or not people support wealth taxes, such taxes can lead to wealth flowing into cash. The only way to get cash is to sell assets or borrow against assets, which causes cash flow issues. Also, wealth inequality makes this politically complex.

So, I believe individuals, companies, and even nations should worry about holding enough gold. Even if you’re not particularly bullish on gold, allocating 5-15% of your portfolio to gold is wise because it’s negatively correlated with other assets. When the economy faces trouble, gold tends to perform well, while other assets underperform.

David Sacks: Why hasn’t Bitcoin shown similar trends to gold? After our last discussion, gold rose 80%, but Bitcoin fell 25%. How do you view Bitcoin’s performance and why hasn’t it become the safe haven many expect?

Ray Dalio:

Bitcoin and gold differ in key ways. First, Bitcoin lacks privacy; transactions can be monitored and even controlled indirectly. Central banks are unlikely to want to buy or hold Bitcoin. Also, questions about new tech developments, like quantum computing, potentially impacting Bitcoin, remain.

Bitcoin’s market size is relatively small and more controllable. Despite attracting attention, its scale compared to gold is still limited. These are dynamic differences between Bitcoin and gold.

David Sacks: What about silver? Over the past year, silver prices surged. Is this a derivative of gold? Or are people just following gold’s trend in silver speculation?

Ray Dalio:

Silver is a byproduct of production, and its supply is hard to increase. Historically, for example, the pound was linked to silver, and silver was seen as a currency. But silver has also become a speculative asset, with people chasing its hype.

Sacks: Last time, you mentioned that maintaining low interest rates is crucial to counter current economic cycle impacts. What are your thoughts on current interest rates and the Fed’s actions over the past year? Are these measures enough to mitigate the effects of this cycle?

Ray Dalio:

Interest rates are one of three main considerations in economic management, along with taxes and government spending. But we can’t keep interest rates artificially too low because debt is someone’s asset. If rates are too low, creditors suffer, leading to familiar dynamics: more borrowing into bubbles.

At the same time, rates can’t be too high, or debtors are squeezed too much. It’s about balance: rates high enough to satisfy creditors but not so high as to crush debtors. When there are many “dead assets” and liabilities—each dead asset linked to debt—this balance becomes very difficult.

This is even more complex in a “K-shaped” economy. Some parts are in bubble territory—like asking, “Who will be the next trillionaire?” involving the top 1%. Meanwhile, other parts struggle—like 60% of Americans reading below a sixth-grade level. Improving productivity for these groups, especially with automation and AI, is a huge challenge.

When assets and liabilities are large, and inequality is high, balancing becomes harder, making monetary policy very complex.

Sacks: Over the past year, many central banks have stopped buying U.S. Treasuries, shifting into gold. Does this mean the Fed must restart buying Treasuries and expand its balance sheet? Is Fed balance sheet expansion inevitable at this stage?

Ray Dalio:

I think it’s possible long-term. Currently, the Fed is trying to manage this by shortening debt maturities, which increases rollover risk. The government is trying to reduce long-term debt issuance, keep short-term rates low, and possibly persuade other countries to buy U.S. debt or attract other capital inflows.

Economists’ Misjudgment of Tariffs

Sacks: Many economists strongly opposed tariffs last year, fearing inflation and reduced consumption, which could hurt GDP growth. The government implemented tariffs under the Emergency Economic Powers Act, but the Supreme Court recently overturned it. Looking back, which predictions about tariffs were correct or mistaken? Did they overlook or misunderstand some fundamental issues?

Ray Dalio:

First, tariffs are a significant source of tax revenue. Economists often fail to include taxes in inflation calculations. An increase in taxes is also inflation. Historically, tariffs have been a major revenue source for governments. For many countries, tariffs are a reasonable way to fund government, and foreign countries also pay part of the tariff cost.

But from a long-cycle perspective, a big problem is that our economy isn’t independent. We’ve experienced manufacturing and middle-class hollowing-out—an important issue. The question now is whether we should rebuild these industries or continue large trade deficits. The U.S. trade deficit is unsustainable; it relies on foreign capital to offset the deficit, which is not sustainable. We need solutions to correct this.

Tariffs can be part of the solution—I see them as reasonable. But they’re not a standalone fix; they should be part of a broader plan. This includes developing necessary industries, infrastructure, and attracting related sectors. It’s both an economic and geopolitical strategy.

We’re entering a more conflict-prone world—shifting from multilateralism to power-based confrontation. Threats among nations are rising—from trade wars to capital wars. We must build economic and political independence as part of shaping the future world.

Sacks: In this week’s State of the Union, Trump expressed a vision that tariffs could fully replace income tax. Do you think that’s feasible? Could tariffs be an effective tax tool, even replacing other taxes?

Ray Dalio:

I don’t think that’s realistic. Mainly because of the scale and impact—tariffs are regressive, and we still face wealth inequality. Wealth gap isn’t just a social issue; it’s also a productivity issue. We need to develop infrastructure and other means to make most people more productive, which is a critical challenge.

Sacks: According to my analysis, nearly half of Americans work directly or indirectly for the government or government contractors. Over the past year, federal employment decreased by about 317,000, or 14% of total federal workforce. The current administration has cut some agencies and staff. Do you think these workers will move to the private sector and become more productive, or will they be absorbed into other government agencies, continuing work that doesn’t contribute to economic growth?

Ray Dalio:

I’ve looked at the data, but I don’t think I can fully answer. Overall, government efficiency is very low. While government plays an important role, even those roles are executed very inefficiently. Some countries manage education better; we need fundamental reform.

For example, education is one of the best areas to invest in. Regardless of where these government workers go, their reallocation and effectiveness are issues. In capitalism, if no one is willing to invest or profit from something, it tends to die out. But systemic inefficiencies and low productivity persist.

Sacks: Is there currently a lack of productivity-driven economic growth that can provide more opportunities to increase income, wealth, and living standards? Or are people’s skills and education insufficient, causing the system to fail them?

Ray Dalio:

Success depends on three points: First, educate children well so they can contribute to productivity and learn civility. Second, society must provide an orderly, civilized environment for competition and cooperation, boosting productivity and benefiting most people. Third, avoid war—internal and international. If these are achieved, the country succeeds. History repeatedly proves this.

Sacks: Are these solutions to current social issues? For example, can rising unions, socialist movements, and wealth taxes be addressed through education, civility, and avoiding war?

Ray Dalio:

We need to stop internal conflicts. The current situation is characterized by irreconcilable divisions. When people support positions more than the system itself, crisis ensues. Our system is at risk because people won’t accept the current or alternative systems—they choose conflict.

Sacks: How does this affect productivity?

Ray Dalio:

When we try to build a good education system, we face chaos and inefficiency, with no one truly in control. Historically, Plato wrote about the cyclical threats of democracy around 350 BC. Today’s situation resembles Rome under Caesar, who was assassinated in the Senate.

We need strong leadership to push reforms and keep the country functioning. But the challenge is how to stop these divided groups from fighting and focus on increasing productivity. It requires a strong leader who can enforce different actions—moving away from conflict toward common goals.

Is America heading toward collapse?

Sacks: It seems we’re on an unavoidable path, possibly forced to choose between some form of socialism and some form of fascism. Is that the current state of the nation?

Ray Dalio:

Yes, I believe so. We are heading into that “war,” and in fact, we are already in it—I call this the “fifth stage.” When a country’s finances are in poor shape, with huge wealth and value gaps, irreconcilable divisions, and external/internal threats, this dynamic emerges. That’s where we are now.

I see myself as a mechanic, not driven by ideology but by practical realities—trying to profit in markets and describing what’s happening. From my perspective, that’s the current situation.

Sacks: Regarding the AI bubble, what’s your view? Many think they’re investing in tech stocks, not AI itself. Is that a misconception?

Ray Dalio:

That’s a common misunderstanding. There’s a big difference between technology and company performance. Many startups fail; only a few succeed. Technology continues to evolve and improve, but that dynamic impacts markets significantly. Looking back at the 2000 tech bubble or late 1920s, technology keeps advancing, but companies may not survive.

Right now, AI seems to be consuming everything, but it might “eat itself”—it may not generate enough profit. We must also consider China’s approach, where AI might be treated like power infrastructure—offered free to all, even open source. This could lead to higher adoption and productivity gains.

In such a scenario, how do we compete? If their tech is nearly as good as ours and free, while we rely on profit models, systemic differences pose risks and uncertainties.

Sacks: Looking at U.S. history, I often ask: how did we get here? Debt levels, government spending, the Fed’s role—all seem like decisions that could have been avoided with different choices. If you could go back and be one of the founders, rewriting the Constitution, what would you do differently? What clauses would you add to prevent today’s crises?

Ray Dalio:

That reminds me of the “marshmallow test”—kids choosing to wait 20 minutes for two marshmallows rather than eating one now. Those who wait tend to make better decisions later. Our problem is instant gratification and ignorance about whether certain actions will boost productivity.

But I also acknowledge the system’s remarkable adaptability. We’ve faced crises, cleaned up debt, and moved forward. Balancing fiscal prudence and innovation is tough. For example, with AI, no one knows what it will bring or whether it will be profitable. Writing laws to ensure fiscal discipline without stifling innovation is very challenging.

My main advice would be: study history. Recognize these patterns and seek balance—between accepting failure and pursuing progress. Balance is key—whether dealing with setbacks or failed investments, finding equilibrium is crucial.