Bridgewater Associates founder Ray Dalio has sharpened his warnings about a structural capital war between sovereign governments and AI hyperscalers, projecting that net annual U.S. debt supply will surge from roughly $3.5 trillion in 2025 to approximately $4.4 trillion by 2027 — an incremental increase of about $500 billion per year before rollovers — just as corporate bond issuance tied to artificial intelligence (AI) infrastructure is doubling on a pace that the International Monetary Fund itself flagged as a systemic risk this week.
The billionaire hedge fund pioneer's thesis is no longer theoretical: both the 10-year Treasury yield ($TNX) and the 30-year yield ($TYX) reached their highest levels since 2002 this week, surpassing 5% and 5.5% respectively, as hotter-than-expected September inflation data — consumer prices rising 3.7% year-over-year and a Producer Price Index (PPI) that jumped 1.3% in a single month, its fastest pace since early 2022 — collided with the Federal Reserve's resumed rate-hiking cycle.
