Bridgewater Associates founder Ray Dalio is skeptical of the U.S. economy despite a soaring stock market and rising GDP, and his flaws point to future economic challenges if they are not addressed.
He warned of a country that heavily depends on the top 1% of its workers. The stock market and economy are heavily tied to artificial intelligence, which has created a rosy picture, as many industries and workers face challenges.
“You can’t look at the U.S. as a whole nowadays,” Dalio said at the Fortune Global Forum last week.
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Although AI has pushed the envelope on human possibilities while attracting plenty of fanfare among investors, its status as a global linchpin risks too much concentration of talent and wealth. Dalio believes that 1% of the population, the people who are the most involved with AI, will have an outsized influence on the global economy in the years to come.
“If you’re looking at, let’s say, the AI world, and really what amounts to about three million people—1% of the population—leading, and then…the 5% or 10% around them, you have one world that the whole world is dependent on,” he said. “Then you have the bottom 60% of the population.”
The dependency on AI may grow as companies replace more jobs. For instance, Amazon (NASDAQ:AMZN) is about to lay off up to 14,000 corporate employees. That represents roughly 10% of the company’s corporate employees.
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Corporations regularly look for ways to boost revenue and profit margins, and AI may allow them to do both. Amazon is one of the many companies that is looking to replace more of its workers with AI. Grocery stores have been using self-checkout for years in a bid to reduce their reliance on cashiers, including Whole Foods, one of Amazon’s subsidiaries.
Retail workers aren’t the only jobs that are in danger. The British Film Institute released a report in June warning that AI is a “direct threat to the economic foundation of the U.K. screen sector,” as AI tools are being used to create and enhance films. That’s also bad news for Hollywood, which provides similar jobs and services as the U.K. screen sector.
