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The CEO of the world's largest hedge fund says populism is now No. 1 market concern

The rise of populism across developed nations is now more important than central banks for global market participants, Ray Dalio, the founder and co-chief investment officer at Bridgewater Associates, said Wednesday.

Dalio - whose company is often named the "world's largest hedge fund" with around $150 billion of assets under management - said that populism, which includes negative views on globalization, was now the number one concern for market participants.

"Populism is not just the belief that there is a wealth gap ... But it's also a sense that they don't represent me. It's a matter of nationalism, it's a matter of getting greater control. It's a matter of increased polarity - the left becomes more left, the right becomes more right - and that particular dynamic, I would say that this is the first year where populism is the most important issue globally," he said at a Bloomberg hosted panel at the World Economic Forum in Davos.

Wednesday's panel in Davos - which also featured economist Larry Summers and Christine Lagarde from the International Monetary Fund (IMF) - discussed the poor employment prospects and low-income growth in many developed economies and the rise in populism seen in the U.S. and several European nations.

"I would say before it used to be central banks, central banks don't matter as much, now the number one issue economically - and as a market participant - is how populism manifests itself over the next year or two," Dalio later added.

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