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Billionaire investor Ray Dalio believes it is still difficult to invest in China at present, as Beijing may seek to structurally move the country away from capitalism. The founder of Bridgewater Associates, one of the world’s largest hedge funds, said investors should take a nuanced and cautious approach when investing in this developing region as it undergoes regime change. “There’s something important going on: they had a debt crisis and they also had a capitalism crisis. Are they… in favor of capitalism as we knew it before? I don’t think that they be the same way,” Dalio said Tuesday in Greenwich. Greenwich Economic Forum, Connecticut. “Structural changes are underway, linked to the government’s desire to maintain total control, and this is affecting the economy,” he added. His comments come as enthusiasm for investment in China has recently picked up. The government has announced a series of stimulus measures in a bid to revive growth and avoid a deep recession in the world’s second-largest economy. These policy measures included reductions in interest rates and a reduction in the amount of cash that banks must hold, known as required reserve ratios. However, investors were disappointed on Tuesday as Chinese officials failed to announce concrete stimulus plans when they outlined new measures to boost the economy at a highly anticipated news conference. The rally in Chinese markets lost steam, with the blue-chip CSI 300 index paring its gains to 5% after climbing more than 10% earlier on Tuesday. “I would say don’t look [the Chinese markets] day after day,” Dalio said. Hedge funds have been piling into struggling Chinese stocks, propelled by hopes of more stimulus. David Tepper of Appaloosa Management recently told CNBC he was buying ” everything” linked to China due to the latest government support. The high-profile investor even said it was increasing its usual allocation limit and not hedging its big bet on China. In recent years, Beijing has is introducing stricter regulations on its domestic technology sector in an effort to curb the power of some of them. In this in-depth interview, Dalio also commented on the Federal Reserve’s policy of easing monetary policy. “he wasn’t expecting big rate cuts because the economy remains healthy we’re going to benefit from significant rate reductions. I think the economy as a whole is relatively well balanced right now,” he said. he declared.
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