It Russia’s unprovoked war against UkraineThis is not the end of globalization, but should signal that there are risks to investing in other countries than democracies. Kyle Bass (Hedge Fund Manager Texas) spoke on CNBC Thursday.

Hayman Capital Management founder said, “You don’t need to paint it that wide of a brush.” “Squawk Box”In an interview, the president was asked about his opinion on whether an interconnected economy that has few barriers to trade is possible. “You must say that each country run under a despotic authority should be reexamined and possibly not invested in.

Bass is a fierce critic for the Chinese Communist Party. His comments were made a week later BlackRockLarry Fink is the CEO wrote in a letter to shareholdersRussia’s invading of Ukraine is “a halt to globalization” that has been occurring for the last 30 years.

Since late December, Russia’s economic crisis has been swift and severe. Vladimir PutinThe United States launched a massive military attack on Ukraine. Along with the government sanction on Russian officials, financial institutions, and oligarchs hundreds of Western businesses stopped operating inside Ukraine.

The world was once a place of great beauty. 11th-largest economyIn response to Western economic isolation, Russia’s economy is likely to shrink and fall into recession. According to the Institute of International Finance, Russia’s economy may shrink by as much as 5% in response to Western economic isolation. shrink by 15% this year.

China and the U.S. have not publicly condemned Russia’s invasion of Ukraine. have warned Beijing it would face “consequences”Russia’s support, if they offer it. European Union leaders will meet with Chinese top officials, including President Xi JinpingFriday. They’re expected to pressureChina remains neutral during war

Bass stated that he believes institutional investors need to understand their fiduciary obligations because Russians have lost all of their investments. China is at the razor’s edge. … If they take the wrong step and actually side with Russia, and then submit to U.S. sanctioning, all U.S.-funded investment in China will be deemed suspect.

In the past few decades China has been a major market for American businesses. It also grew rapidly to be the second largest economy in the world. This is not just a crucial link in global supply chains but also an important consumer market.

Bass claimed that there has been a widening of the divide between how U.S. intelligence officers and military officials see China and Wall Street’s view.

“In the end, what Putin just taught is, we need to look at the despotic autocrats and we need to really rethink if the negative convexity — or the negative risk — that we’re associating with these potential countries is worth the investment,” Bass said.

Bass stated that he believed for a long time the U.S. would fall apart economically due to the fact the “fundaments of both countries are so diametrically opposite one another.”

Putin’s actions have accelerated that process. Over the next few years, I believe we will find out if taking this risk was worth it. He said that he believes those who took these risks will realize they were not worth the risk.