Ray Dalio: Fed’s Economic Bubble Is Just a Giant Marshmallow!

by

If you’ve ever inflated a balloon while blindfolded, congratulations-you’ve just joined the Federal Reserve’s 2025 party. Ray Dalio, that guy who probably owns a yacht named “Practical Wisdom,” says the Fed is turbocharging the economy into a bubble so big, even Wall Street’s idea of “fun” is now a fire extinguisher. And to think, this is the final act of a 75-year economic cycle. Who knew capitalism had a Netflix series?

Typically, the Fed cuts rates when things are falling apart-like the Great Depression or 2008. You know, the times when “stagnant economy” isn’t just a metaphor but a vibe. But now? They’re easing policy while unemployment is lower than my patience at a family reunion, growth is happening, and asset prices are doing the cha-cha. Dalio calls it “late-stage economy,” which sounds less like economics and more like a TikTok phase.

This “dangerous” mix? Dalio says it’s inflationary. Spoiler: he’s right. Your rent, your coffee, and your therapist’s hourly rate will all be front-row guests at this party. Investors, he warns, should watch for fiscal decisions. Because nothing says “caution” like a man in a pinstripe suit whispering, “monetize the debt” while sipping a $20 latte.

“Because the fiscal side of government policy is now highly stimulative, due to huge existing debt outstanding and huge deficits financed with huge Treasury issuance-especially in relatively short maturities-quantitative easing would effectively monetize government debt rather than simply re-liquify the private system.”

Translation: We’re printing money so fast, Benjamin Franklins are forming a union. Meanwhile, Bitcoin, gold, and other “store-of-value” assets are the financial equivalent of a life vest at a pool party. Or, as I call it, “things that don’t turn into vapor when the Fed sneezes.” 🐘✨

Fed Chair Jerome Powell, in October, said: “There were strongly differing views about how to proceed in December.” Translation: “We have no idea what we’re doing, but we’re 100% sure it’ll be a surprise!” Over 69% of investors bet on a 25-basis-point rate cut in December, per the CME. Meanwhile, the October cut did absolutely nothing for crypto markets. Probably because everyone already knew it was coming-like a birthday present you ordered yourself.

Analyst Matt Mena of 21Shares says the cut was “fully priced in.” Translation: “We all saw this coming, but let’s pretend we’re still shocked.” Because nothing says “financial expertise” like acting surprised when gravity does its thing. 🌪️💸

Read More

2025-11-06 21:33