Bridgewater Associates founder and co-chief investment officer Ray Dalio said in a recent interview that years of low interest rates and quantitative easing have squeezed nearly every last cent out of assets in the United States.

Bridgewater is the largest hedgefund in the world, holding about $160 billion in assets, and Dalio is one of the 100 richest people in the world, according to Bloomberg.

“We will have low returns going forward for a long time,” Dalio said in an interview Monday with Bloomberg’s Barry Ritholtz for the Masters in Business podcast.

Dalio said he believes the next global recession will hammer Europe particularly hard because there isn’t a common fiscal union or unity among countries.

“Europe will probably be the most strained,” Dalio said.

Interview highlights per Bloomberg:

  • Today’s debt cycle is most reminiscent of the late 1930s, a time of rising populism and growing disparity between the rich and poor. Then and now, governments will have limited ability to deal with an economic downturn, with levers such as low rates and quantitative easing.
  • History has shown many examples of a rising power challenging the existing order, and today Dalio sees China playing this role. Its growth gives rise to the possibility of more conflict, and “not to consider or be worried about external conflict would be dangerous,” he said.
  • The billionaire said ocean exploration and micro-finance are the most important focus of his philanthropy. Dalio said the book investors should read now is Paul Kennedy’s “The Rise and Fall of the Great Powers.”

Dalio has been a global macro investor for more than 45 years, founding Bridgewater out of his two-bedroom apartment in 1975 in New York City. Dalio is the author of “Principles: Life and Work,” a New York Times bestseller. His latest book, “Principles of Navigating Big Debt Crisese” was just published this month.

Click here to check out the Ritholtz podcast with Ray Dalio in full.