Part 7/12:
Dalio refers to recurring cycles that historically lead to conflicts, emphasizing the importance of understanding these patterns:
Long-term Debt Cycle: Countries accumulate unsustainable debt, leading to economic crises. The U.S., in particular, faces a high debt-to-GDP ratio, risking a contraction similar to the 1930s Great Depression era.
Internal Order/Disorder Cycle: Western democracies, especially the U.S., are experiencing rising political division and internal unrest. The political landscape is polarizing, with moderate voices weakening while extremists gain influence.