Trump's actions could spark 'Capital Wars': Ray Dalio

US President Donald Trump's moves could trigger 'capital wars,' leading to a loss of appetite for US debt in the markets, according to Ray Dalio, founder of hedge fund giant Bridgewater Associates.

“On the other side of trade deficits and trade wars, there are capital and capital wars,” Dalio told CNBC at the World Economic Forum in Davos.

Dalio expressed concern that if trust erodes, major holders of US dollars and Treasurys may not be willing to absorb more US debt, while the US continues to flood the market with new bond issuance.

"When you have conflicts, international geopolitical conflicts, even allies do not want to hold each other's debt," he said.