March 16, 2020 / 1:25 PM / 18 days ago

Coronavirus combined with zero interest rates 'really worries me,' Bridgewater's Dalio says

NEW YORK, March 16 (Reuters) - Billionaire hedge fund manager Ray Dalio, whose main Bridgewater Associates LP hedge fund fell sharply amid the coronavirus-led market rout, is concerned about the combination of zero interest rate policy and the growing health pandemic, he said in a note Monday.

“I have been concerned that when the economic downturn would come, it would lead to hitting the 0% interest rate in an economic downturn with a lot of debt outstanding and big wealth and political gaps the way that configuration of events happened the 1930s,” Dalio wrote.

“The coronavirus was the thing to cause the downturn, which surprised me. While it is an extremely serious infectious disease and that will produce many harmful economic impacts, these things alone don’t scare me; however, when combined with long-term interest rates hitting the hard 0% floor, that really worries me.”

Reporting by Lawrence Delevingne; Editing by Steve Orlofsky

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