Prominent Investor Dalio Warns that Resumption of Fed's Quantitative Easing Could Accelerate Bubble Formation, Heightens Inflation Risks

Ray Dalio, founder of the world's largest hedge fund, Bridgewater Associates, posted an article on June 6th titled 'Stimulus to the Bubble', in which he warned that the Federal Reserve's decision to end quantitative tightening (QT) and resume quantitative easing (QE) could act as a 'stimulus that worsens the bubble' under the current economic conditions. While previous rounds of QE by the Fed were aimed at addressing asset safety, economic weakening, low inflation rates, and liquidity issues—essentially a 'stimulus to the recession'—the current circumstances are entirely opposite. Asset prices are trending higher in a high-price zone (S&P 500 earnings yield...)