Dalio: "US-China Conflict... Similar to US-Japan During WWII"

Warning from the Godfather of Hedge Funds Amid the US-China Semiconductor War Round 2 Crisis

Ray Dalio, known as the godfather of hedge funds, compared the U.S. export control measures on advanced semiconductors to China to the U.S. oil embargo on Japan imposed just before the outbreak of World War II, warning that U.S.-China relations are facing an extreme confrontation.

According to Bloomberg on the 3rd (local time), Dalio said in an interview at the Greenwich Economic Forum held in Greenwich, Connecticut, that "U.S.-China relations are on the verge of a red line in several areas." He explained that the U.S. banned oil exports to Japan before World War II in 1941, which became the trigger for the war. Dalio sees the current crisis between the U.S. and China as similar to that situation, with semiconductors replacing oil.

He also pointed out that "at the center of the irreconcilable differences between the two countries is the Taiwan issue." He added, "Saying that the U.S. supports Taiwan's independence is like declaring war on China."

He predicted that the conflict between the U.S. and China will surface in some form. However, he noted, "Neither country wants war. Everyone fears how economically and politically destructive that war would be."

[Image source=Reuters Yonhap News]

Ray Dalio, who leads the world's largest hedge fund Bridgewater Associates, is also known as an investor in China. Dalio, considered a prominent pro-China figure, has consistently warned about U.S.-China tensions. In April, after returning from a visit to China, he posted on LinkedIn that tensions between the U.S. and China are worsening ahead of next year's presidential election, analyzing that the current situation, which seems as if a U.S.-China war is imminent, stems from an emotional battle over communication.

Meanwhile, major foreign media reported the day before that the U.S. Department of Commerce is expected to announce additional export control measures on semiconductor equipment and artificial intelligence (AI) chips to China soon. According to reports, the U.S. has informed the Chinese government that it may update export controls on semiconductor equipment to China as early as the beginning of this month. Last year on October 7, the U.S. government imposed comprehensive restrictions on exports of advanced semiconductor equipment and AI chips using U.S. technology to China. As the first anniversary approaches, the U.S. government has signaled additional measures, drawing market attention to whether the semiconductor conflict between the two countries will deepen.

This content was produced with the assistance of AI translation services.