One of of the world’s most successful investors has warned that the UK is stuck in a “debt doom loop”.
Hedge fund manager Ray Dalio, who founded Bridgewater Associates, was speaking as UK debt as a percentage of GDP (gross domestic product) rose to 101%.
Long-term borrowing costs are higher than they have been at any point this century, giving the Chancellor Rachel Reeves little room to borrow more to fund spending, and thus requiring a focus on raising taxes instead.
Mr Dalio told the ‘Master Investor’ Podcast with Wilfred Frost she risked alienating the very people who could help get the country out of its fiscal bind – mirroring concerns expressed by the boss of Goldman Sachs last week.
“The debt doom loop is affecting capital flows. So the necessity for creating taxations that then drive people away.
“As the financial problems and the social problems worsen, having the effect of causing people with money to leave.
“That’s a problem because, I don’t know the exact numbers in the UK, but they’re analogous to the US, where 75% of income taxes are paid by the top 10%.” | Sky News
