Ray Dalio says Middle East is becoming a ‘Silicon Valley of capitalists’
Bridgewater founder Ray Dalio speaks to CNBC at the Future Investment Institute 2025 summit in Riyadh on October 28, 2025.
CNBC
The Middle East is rapidly emerging as one of the world’s most powerful artificial intelligence hubs, Bridgewater Associates founder Ray Dalio said Monday, comparing the region’s rise to Silicon Valley’s interest in all things tech.
Speaking to CNBC, Dalio said the United Arab Emirates and its neighbors are combining vast capital pools with global talent flows, creating a magnet for investment managers and artificial intelligence innovators alike.
UAE and Saudi Arabia this year launched multibillion-dollar initiatives to build cloud, data centers and other AI infrastructure backed by sovereign wealth capital and global technology partnerships.
$10 billion agreement between Google Cloud and Saudi Arabian Public Investment Fund announced this year It aims to create a “global AI hub” in the country as part of a broader effort to host data centers and AI workloads locally.
Earlier this year, tech giants OpenAI, Oracle, Nvidia and Cisco joined forces to build a massive Stargate AI campus in the United Arab Emirates.
Asked if he thought the UAE, Saudi Arabia and Qatar could be leaders in the AI race, Dalio said: “What they did was create talented people. So that’s it.” [region] “It’s kind of turning into the Silicon Valley of capitalists… So now people are coming… money is coming, talent is coming.”
Dalio, who has been visiting Abu Dhabi for more than three decades, said the transformation in the Gulf was the result of deliberate state management and long-term planning. He described the UAE as “a paradise in a troubled world”, citing its leadership, stability, quality of life and ambition to create a globally competitive financial ecosystem.
“There’s a buzz about artificial intelligence or technology here in San Francisco and places like that. It’s very similar to that,” Dalio said.
Next two years ‘precarious’
Bridgewater’s founder warned that the global economy was heading for an uncertain near-term future due to the combination of multiple forces and reiterated concerns that markets were in a bubble.
“The next year or two will be more unstable,” he said, pointing to the convergence of what he called three dominant cycles: debt, US political conflict and geopolitics.
global debt burden It already puts stress on the pockets of the market.
“We’re seeing cracks in the markets in a variety of ways, private equity, venture capital, refinancing debt, all of those things. So I believe we’re in a bubble by almost all of those measures,” Dalio said, highlighting the similarities to the 2000 bubble, not the one in 1929.
He also expects US politics to become even more disruptive towards 2026. “As we head into the 2026 election… you’re going to see a lot more conflict in different ways,” Dalio said, adding that high interest rates and concentrated market leadership were increasing fragility.
“Not every country can keep piling up the debt it has, but politically can’t raise taxes and cut benefits. That’s why they’re stuck.” This financial nexus is fueling a broader rise in domestic polarization: “We now have populism on the left and populism on the right… which means irreconcilable differences.”
Dalio reiterated his view that the AI rally is in bubble territory but advised investors not to rush to exit just because valuations are stretched.
Concerns about an AI bubble have been swirling in recent months, with prominent voices such as OpenAI CEO Sam Altman suggesting that the AI market is in a bubble. Commenting on the subprime mortgage crash of 2008, investor Michael Burry predicted that the AI market bubble could collapse within the next two years.
“All the bubbles occurred during times of major technological change,” Dalio said. “You don’t want to get out of there just because of the balloon. You want to look for the balloon to sink.”
The catalyst for this “sting” often comes from money tightening or having to sell wealth to meet obligations, he said.
He also warned of stress in the venture capital, private equity and commercial real estate sectors, where cheap debt is now being rolled out at higher rates.
