The world order has seen dramatic shifts over the last few years. Global leaders agree that the post-1945 world order had broken down, as they say it is an era of new geopolitics and a new world order.
Ray Dalio, billionaire investor and the founder of Bridgewater Associates, believes the world is in “stage 6” part of the “big cycle” or the periods of good and bad times, in which rules weaken, great powers clash, global cooperation declines, and might is always right.
Dalio, in his detailed post on the social media platform X, highlighted the Munich Security Report 2026 to argue that the post-World War II world order has broken down.
Dalio’s post on German Chancellor Friedrich Merz said, “The world order as it has stood for decades no longer exists.” French President Emmanuel Macron underlined that “Europe must prepare for war as its old security structures tied to the previous world order don’t exist.” US Secretary of State Marco Rubio highlighted that we are in a “new geopolitics era” because the “old world” is gone.
The world is entering a new order
The prevailing global conditions are reminiscent of historical events that have led to conflict and chaos.
Dalio offered insights from his book “Principles for Dealing with the Changing World Order” to underscore that the post-1945 world order is broken down, and we are entering a new world order.
He explained in detail how stage 6 works in chapter 6, “The Big Cycle of External Order and Disorder,” in his book.
In his post, Dalio explained that “when individual countries have more power than the collectives of countries, the more powerful individual countries rule.”
He explained it by giving an example that if the US, China, or other countries have more power than the United Nations, then the latter will not determine how things go, because “power prevails, and wealth and power among equals is rarely given up without a fight.”
“The international order follows the law of the jungle much more than it follows international law,” Dalio writes.
As per him, there are five major kinds of fights between countries: trade or economic wars, technology wars, capital wars, geopolitical wars, and military wars. All these are power struggles, even though they don’t involve shooting and killing.
“These struggles and wars, whether or not they involve shooting and killing, are exertions of power of one side over the other. But once a military war begins, all four of the other dimensions will be weaponised to the greatest extent possible,” Dalio writes.
Since 1500, Europe has witnessed three big cycles of rising and declining conflict, each lasting about 150 years.
“Each cycle consisted of a relatively long period of peace and prosperity (eg, the Renaissance, the Enlightenment, and the Industrial Revolution) that sowed the seeds for terrible and violent external wars (eg, the Thirty Years’ War, the Napoleonic Wars, and the two World Wars),” Dalio explains.
Further, Dalio explained that the US economic crisis of 1929 prompted it to turn protectionist to “safeguard jobs and raise tariffs via the passage of the Smoot-Hawley Tariff Act in 1930, which further depressed economic conditions in other countries.”
“Raising tariffs to protect domestic businesses and jobs during bad economic times is common, but it leads to reduced efficiency because production does not occur where it can be done most efficiently,” Dalio explains.
“Harmful acts of nature (eg, droughts, floods, and plagues) often cause periods of great economic hardship that, when combined with other adverse conditions, lead to periods of great conflict,” Dalio writes.
Dalio says every world power has its time in the sun, but they all eventually decline.
“A number of empires and dynasties have sustained themselves for hundreds of years, and the United States, at 245 years old, has proven itself to be one of the longest-lasting,” writes Dalio.
Disclaimer: This story is based on Ray Dalio’s social media post and is for educational purposes only. The views and recommendations expressed are not those of Mint.
