By Xie Yu

HONG KONG, (Reuters) – Ray Dalio from the United States, the founder of the largest hedge fund in the world, said that investors should be aware of current inflationary conditions and not consider cash a secure investment.

The comments were made as global central banks prepare to or begin tightening monetary policy in an effort to stem rising inflation. However, the Omicron coronavirus variant is still a concern for the global economy.

Dalio, founder of Bridgewater Associates said this week at a virtual UBS Greater China Conference, “The mindset has to change.”

In other words: inflation adjusted to reflect your desire for buying power. That’s what we’re trying store.

“If your asset is very volatile and has very little return, it should be stable, and loses to inflation..,” he stated.

He suggested that investors remain well-diversified in terms of geography and currency, but not go into detail.

Dalio also supported China’s “common prosperity” campaign. According to him, Chinese leaders see a cycle where the country becomes rich first before trying to spread opportunities more equally.

Bridgewater, a Chinese foreign hedge fund that has been active in China since its registration with the Chinese authorities in 2016, is the largest. The Chinese authority now manages more than 10 million yuan ($1.57 trillion) in assets.

“I think a lot of people… tend to make a mistake of thinking that this is like a return to communism under Mao, rather than understanding it’s just part of the evolutionary process,” he said. The United States needs greater common prosperity, as do many other countries.

($1 = 6.3722 renminbi)