Squawk Pod: Ray Dalio, Bubble Fears, & Nvidia’s Beat

Episode Date: November 20, 2025
Main Hosts: Becky Quick, Andrew Ross Sorkin
Featured Guests: Ray Dalio (Bridgewater Founder), Christina Partsinevelos (CNBC), Emily Wilkins (CNBC)

Overview: What Drives Markets—and Risks—Today?

This episode of Squawk Pod centers around Nvidia’s blockbuster third-quarter earnings, renewed questions about an AI-driven tech bubble, and a wide-ranging interview with legendary investor Ray Dalio. The hosts and guests dissect the implications of Nvidia’s outperformance, debate the sustainability of current market euphoria, and probe Dalio on the nature of economic bubbles, leverage, private markets, and the reliability of cash, gold, and crypto in turbulent times.
The tone throughout is inquisitive, energetic, and candid, with both evidence-based optimism and well-argued caution.

Nvidia’s Monster Quarter: AI Hype vs. Bubble Concerns

The Results and Immediate Reactions

• Nvidia “blew out” expectations for Q3, calming investor fears and driving up major market averages.
  • “The biggest report of earnings season. It did not disappoint. The AI bulls are winning.” – Becky Quick [01:14]
• Despite prior market jitters, Nvidia’s results showed AI demand is robust and, according to Cantor Fitzgerald, even “underhyped.”
• CEO Jensen Huang and CFO addressed doubts about “AI bubble” talk on the earnings call, highlighting $500B-plus backlog, unmet demand, and enduring value in even older chips.

Detailed Analysis & Industry Implications

• Circular Financing Debate: Controversy persists about Nvidia’s investment in OpenAI (equity for supply deals), with questions about whether this constitutes “circular vendor financing.”
  • “Rather than giving up a share of our company, we get a share of their company and we invested in them in one of the most consequential...in a generation company.” – Jensen Huang (via Becky Quick quoting the call) [04:12–04:22]
  • Christensen: The OpenAI investment is not finalized, and details remain lawyerly, so “it’s not a done deal.”
• Depreciation of Chips: There’s industry confusion about how long Nvidia’s chips remain valuable. Some, like CoreWeave, now use a six-year depreciation; others, like Nebula, use four. MSFT’s CEO suggests layering old and new chips for extended utility.
  • “The useful life is not the issue...the question is unlike building railroads...you might need to constantly be upgrading.” – Becky Quick [07:43–07:49]
• Risk for Hyperscalers: While the model is brilliant for Nvidia, hyperscalers could face math problems if chip lifecycles are shorter than amortization periods, especially if margins don’t keep up.
  • “That’s fabulous for Nvidia but bad for everybody else and unclear whether then the math will make sense for them.” – Becky Quick [08:34]
• The Growing Competition: With hyperscalers like Google and Amazon developing their own AI chips, competition looms, though Nvidia’s CUDA software ecosystem remains a moat.
  • “Nvidia will say, well, they don’t have the Cuda software...that’s their winning recipe almost at this point.” – Christina Partsinevelos [10:53]

Market Impact

• Nvidia’s 5% stock jump = $225B in market cap—equivalent to the entirety of Disney or Goldman Sachs.
  • “A 5% move...is about $225 billion. That’s more than the equivalent of a Disney market cap...It means big deal not just for Nvidia but also for the major averages.” – Andrew Ross Sorkin [11:12]

Policy Buzz: Federal Standards in AI Regulation

Legal Debate

• The White House is considering an executive order for a single national standard on AI, which would preempt state-level AI regulations. Trump openly supports this.
  • “A 50 state patchwork is a startup killer...federal legislation is essential. There’s no bigger issue for Little Tech...” – Mark Andreessen (via Emily Wilkins) [13:13]
• Critics like Sen. Brian Schatz warn against preempting state regulations before having robust federal rules in place.
• Congressional action to limit state authority over AI regulations may be bundled into must-pass bills but faces partisan gridlock.

Spotlight Interview: Ray Dalio on Bubbles, Wealth, and Markets

What Makes a Bubble (And What Pops It)?

• “There’s definitely a bubble in markets...A bubble is that there’s a lot of creation of wealth from various ways...and then the question...is who needs the money?” – Ray Dalio [17:01]
• Dalio distinguishes between asset price growth driven by sustainable earnings and unsustainable demand—bubbles happen due to the urgent “need for cash” by holders.
  • “Bubbles don’t go happen because of good estimates of what in the future. It happens because of the need for cash. Do you sell that asset for cash for some reason?” – Dalio [18:20]

How Far Along Are We?

• Using his proprietary “bubble indicator,” Dalio says we’re about 80% of the way to the kind of bubble that characterized 1929 or 2000.
  • “If I was to show you the chart, it’s about 80% of where it was in those times. That doesn’t mean that’s the end of the move...Bubbles have to be pricked.” – Dalio [22:05]

What Pricks Bubbles?

• Classic cause: tight monetary policy (i.e., higher rates) or new taxes that force asset sales.
• Bubbles burst when wealth can’t be converted into money at today’s prices: owners need cash, must sell, and “too many claims on money” leads to rapid deflation in asset values.
  • “You have to sell wealth in order to get cash to buy things. And so when that happens, bubbles burst.” – Dalio [20:14]

Investor Takeaways: What To Do in a Bubble (And Timing Risk)

• Don’t sell just because a bubble exists.
  • “Don’t sell just because there’s a bubble…But if you look at the correlations with the next 10 years returns, when you are in that territory, you get very low returns.” – Dalio [24:03]
• Historical data suggest entering markets at high valuations results in lackluster decade-long returns.
  • “Over a 10 year period, your return is a delta between 2% and -2% a year over 10 years.” – Becky Quick (summarizing JP Morgan) [24:22]
• Diversification as Solution: Dalio advocates for a well-diversified asset allocation. Gold is emphasized as a key diversifier.
  • “You start off with what is a well-balanced, diversified portfolio. We talk about certain things like gold as being part of that...that mix. We can talk about gold, we could talk about these other assets. But I think that that kind of diversification.” – Dalio [25:47]

Views on Cash, Gold, Crypto, Debt

• Gold: The “second largest reserve currency.” Not dependent on counterparty risk, immune to certain technology risks, and especially valuable when fiat is debased.
  • “Gold is the second largest reserve currency. It’s money. So when it diversifies the portfolio, that is...an important element. It’s negatively correlated. It does very well in such bubbles.” – Dalio [26:20]
• Cash: Useful, but suffers from similar debasement and “money is debt”; be wary of US dollar exposure in the long run.
  • “I don’t like debt...I would rather be short debt in a sense.” – Dalio [27:17]
• Bitcoin: Dalio holds a small allocation (~1%), but isn’t bullish on its reserve capability due to surveillance and quantum/hacking risk.
  • “Bitcoin...not going to be a reserve currency for a major countries because it can be tracked...with quantum computing, controlled, hacked and so on.” – Dalio [30:18]
• Debt Concerns: US (and global) government debts are swelling; inability to tax, spend less, or sell bonds points toward financial strain and possible market/political instability.
  • “We have a debt problem. We have a value of money problem...I’m deeply concerned about that.” – Dalio [27:14, 28:38]

On Private Markets and Leverage

• Private equity deals are struggling: can’t sell, pricing is an issue, and private credit is highly exposed.
  • “If you’re looking at the private equity markets, they have a bunch of problems...can’t sell deals, pricing of deals, returns and so on. Can’t get cash out of them.” – Dalio [28:10]

Policy and Political Overhang

• Ongoing risk from political polarization/redistribution (wealth taxes, regulatory uncertainty) complicates the economic landscape nationally and globally.

Memorable Quotes

• “A bubble is an unsustained set of circumstances. It has unsustained amount of buying and has an unsustained amount of valuation.” – Dalio [23:31]
• “Too much wealth and not enough money is basically what happens. So the wealth just disappears and goes to wealth heaven.” – Andrew Ross Sorkin [34:05]
• “There’s always the best asset to hold during those times...it’s a combination of bonds and gold.” – Dalio [35:21]

Notable Timestamps & Segments

• 00:00–01:00 Ads and show intro (skipped in summary)
• 01:04–12:22 Nvidia’s blowout earnings, AI bubble debate, chip depreciation, market reaction, and regulatory angles
• 16:23–36:00 Ray Dalio interview: bubble mechanics, leverage, diversification, risks in private debt/equity, gold/cash/crypto debates, and systemic dangers
• 12:22–14:23 National AI regulation, politics and tech lobbying

Key Takeaways

• Nvidia’s earnings reinforce current AI optimism, though the path ahead may get bumpier as industry dynamics and competition shift.
• Dalio warns that markets are deep in bubble territory (80%), but history suggests bubbles can last much longer and become even more irrational before they burst.
• The greatest risk comes from liquidity crunches—not high valuations themselves—which force asset sales.
• Diversification, especially with allocations to gold and non-debt stores of value, remains Dalio’s top advice for weathering the next turbulent decade.
• Private markets and leveraged credit are a growing concern lurking beneath the surface of strong public market headlines.
• Policy remains in flux, with tech, finance, and politics increasingly intertwined in the AI and capital markets world.