Core Insights - Ray Dalio warns of sustained long-term weakness of the US dollar against gold and major currencies, predicting a decisive shift in global capital flows by 2025 [1] - The dollar has declined 39% against gold, 12% against the euro, and 13% against the Swiss franc [1] - Gold has returned 65% in dollar terms, significantly outperforming the S&P 500 by 47% [2] Currency Performance - The S&P 500 fell by 28% in gold-money terms, while European stocks outperformed US equities by 23% and Chinese stocks by 21% [3] - The decline of the dollar is attributed to structural fiscal imbalances and changing expectations for monetary policy [3] Debt and Fiscal Policy - A significant amount of debt, nearly $10 trillion, will need to be rolled over, with simultaneous Fed easing making debt assets less appealing [4] - The expectation of a further steepening of the yield curve is probable [4] Political and Economic Implications - Current policies aimed at revitalizing manufacturing are widening wealth gaps, with the affordability issue expected to be a major political topic [5] - Geopolitical shifts are accelerating dollar weakness, with a transition from multilateralism to unilateralism noted for 2025 [6] Financial Conditions - The US bond market is experiencing its steepest yield curve since 2021, with a spread of 140 basis points between two-year and 30-year Treasuries [7]