By CCN.com: Ray Dalio, the investment chief at the $160 billion Bridgewater hedge fund, joins other money titans and economic experts in warning that a recession looms on the horizon, threatening to wipe out the US stock market. Others still disagree.

Dalio Does Davos, Warns US Stock Market Faces ‘Significant’ Risk of Recession

Speaking to CNBC at Davos, Dalio says there is a “significant” risk of recession for America in 2020. Not just for the US though, an economic slow will be global:

It’s not just the United States; it’s Europe, and it’s China and Japan.

Dalio pointed to the need for perspective. Investors have so far ignored the economic signals of recession, but they will react over a longer “time horizon” as its impact is felt in the stock market.

Where we are in the later [economic] cycle and the inability of central banks to ease as much, that’s the cauldron that will define 2019 and 2020.

Despite interest rate hikes over the past two years by the US Federal Reserve, interest rates remain relatively low, leaving little room for further quantitative easing should a full-blown recession occur.

Investors may react more profoundly to the build-up to the 2020 US presidential election and the potential impact a change in government would have on tax rates and capital gains.

Ray Dalio says talk of 70% income tax will play a greater role https://t.co/Mh7eIbdBie pic.twitter.com/rLvASlJiy8 — Bloomberg Economics (@economics) January 22, 2019

Dalio has greater social and political concerns too. Speaking at Davos this week, he said that the “next downturn in the economy” worries him — the manager of the world’s largest hedge fund — the most.

What scares me the most longer term is that we have limitations to monetary policy — which is our most valuable tool — at the same as we have greater political and social antagonism.

Bloomberg economists recently put the chances of a recession in the next year as having doubled, rising to 25% from last year’s level. David Rosenberg, Gluskin Sheff’s chief economist and strategist, said in early January that stock market moves signaled an imminent recession.

Blackstone CEO Steve Schwarzman Doesn’t Agree

Even with new economic data out of China and building fears in Europe, Blackstone CEO Steve Schwarzman disagrees.

He says:

I don’t know where that came from the last two months of the year. Consumer confidence is down a little bit, which I think comes from some of the dysfunction, but they are still spending a lot of money.

The U.S. economy may be slowing, but that doesn't mean it's heading towards a recession, Blackstone CEO Steve Schwarzman said at #WEF19. https://t.co/PcDK4eG3XS pic.twitter.com/3rKHAjfDLu — CNBC (@CNBC) January 22, 2019

Schwarzman believes 4.2% economic growth seen in the US in 2018 is “unsustainable” but that growth in 2019 is likely hold near 2.5%. This despite reports that the lingering after-effects of the government shutdown could already be dropping US growth to zero. The Blackstone CEO says he doesn’t “see any recession.”

I see the US sort of rolling along here but at a lower rate for growth.

Schwarzman is a Republican donor and an advisor to US President Donald Trump. Trump also deflects recession fears. A recent survey by The Conference Board indicated US CEOs are less worried about a recession than other global business leaders. Are they blindly following Trump’s economic rhetoric?

Earlier this month, OppenheimerFunds CIO Krishna Memani said a recession wasn’t likely within the next five years. JP Morgan CEO Jamie Dimon says the US is experiencing a slowdown, not a recession and that everyone should “take a deep breath.”

Ray Dalio Image from Reuters/Brian Snyder