Ray Dalio worried the US is the most divided since 1937

Bridgewater Associates founder and co-CIO Ray Dalio thinks that democracy is being threatened. In a LinkedIn post published Monday, Dalio said that democracies are healthy when the principles "that bind people are stronger than those that divide them." In turn, "democracies are threatened when the principles that divide people are more strongly held than those that bind them and when divided people are more inclined to fight than work to resolve their differences."

"It seems to me that we are now economically and socially divided and burdened in ways that are broadly analogous to 1937," Dalio wrote. "During such times conflicts [both internal and external] increase, populism emerges, democracies are threatened and wars can occur. I can't say how bad this time around will get. I'm watching how conflict is being handled as a guide, and I'm not encouraged."

The missive comes as U.S. markets appear to have hit a wall, political conflict in Washington has escalated, and thousands are protesting in the streets over historic monuments.

Wall Street had been hoping that President Donald Trump's election would bring with it a new business-friendly era in Washington. Dalio was among those encouraged by the new administration's potential to impact growth, but has since soured on the president.

Amid the conflicts, Dalio said his firm is "tactically reducing our risk" to the current problems "not being handled well." In a separate LinkedIn post recently, Dalio encouraged investors to buy gold amid global conflict.

Bridgewater is the world's largest hedge fund, with about $160 billion in assets. While three of Bridgewater's four funds have struggled this year, Dalio has increased his public profile ahead of the release of his first book, "Principles: Life and Work."