Ray Dalio: We’re Heading Into Very, Very Dark Times! America & The UK’s Decline Is Coming!

Pay attention. Pain plus reflection. equals progress. And from that. principle, my company became the largest. hedge fund in the world. >> Managing how much? >> 150 billion dollars. But I learned that. history of things that never happened in. my lifetime before were important things. to understand in order to predict the. future. And we can get into that if you. want. >> Please. So Ray Dalio is the legendary. billionaire investor. >> who decoded the cycles of human history. to predict financial crashes, build the. world's largest hedge fund, and now to.

warn us about what lies ahead. Are you. optimistic about the future of the UK? No. What about the United States? No. Why? Okay. In order to bet on what's. going to happen on the global economy, I. learned that there's five big forces. that create a big cycle that's repeated. through history, which lasts about 80. years. The first is the money debt force. that creates wealth and opportunities. gaps. And it's connected to the second. force, the internal conflict where you. don't trust the system, causing wars.

between the left and the right. And it's. not easy answers like tax the rich. And. we can get into that. But the third is. geopolitical force. In other words, international conflict. Then there's. acts of nature. And then number five is. man's inventiveness, particularly of new. technologies. Now, the question is who. wins the technology war because the. winner of that determine how the new. world order works. Is it something to be. concerned about? >> No. The question is how you as an. individual handle it. How do I as an.

individual handle it? So there's. building your financial strength, flexibility, importance of being. open-minded, and how to get more out of. the minute, not how to work harder. And. I really urge your audience to learn all. of this. So, first of all, I see messages all the time in the. comment section that some of you didn't. realize you didn't subscribe. So, if you. could do me a favor and double-check if. you're a subscriber to this channel, that would be tremendously appreciated. It's the simple, it's the free thing. that anybody that watches this show. frequently can do to help us here to. keep everything going in this show in.

the trajectory it's on. So, please do. double-check if you subscribed. And. thank you so much because in a strange. way you are you're part of our history. and you're on this journey with us and I. appreciate you for that. So, yeah, thank. you. Ray, I I want to describe to you who's. listening right now. And the question I. have for you is what is the most. important thing that this persona of. person should be thinking about at the. highest level right now. So, the the.

person that's listening is someone who. is intent on improving their life. They're they're really interested in. business, potentially starting their own. business. They they care about where. they're investing their their time and. energy, and also where they're setting. up their home based on in terms of. geography. They are aspiring to accomplish some. goal. They're probably between the age. of 18 and. 50 predominantly. And they are very very interested in. understanding what's happening in the.

world that feels incredibly. scary, fast-paced, and uncertain at the moment. This is a very difficult question. But. if anyone I was going to ask anyone, it. would have to be you. What what's one of the first things they. should be considering at this moment to. safeguard their future, their family, their finances? I don't think it's a. difficult question. I um. I think it's it's very clear. They have. to understand how the life cycle works. Okay. They have to understand how it. works. We were just talking before and.

and on the book and there was the arc of. the life cycle, right? And you have to. understand that you're on an adventurous. journey, okay? And you have a certain. nature, you know, those qualities that make make. you have your preferences and so on. And. then you're going after the things that. you like and you're learning and it's. going to have the ups and downs and so. on. And how you approach that. So, you.

asked from the higher level if I'm. looking down, you know, like that life. cycle, that arc, what's that journey. like? How do you approach it? You know, what. are your principles? How do you even. learn how to approach it? That's why. we're having these conversations, right? So, that's clear. You know, what's your nature? How's the journey? How do you find the path that's suitable. to your nature? And then you'll go down that path and. you'll discover.

and you'll evolve. What's that like? That's what they need. to know. You said what's your nature. What do you mean by nature? >> People are born with and then also their. environment creates their different. nature, you know? We have our. preferences, our inclinations. We think. in a certain way. You chose to be. entrepreneurial, okay? You're living out. your nature, okay? This isn't for. somebody else. You know, some people. have a different nature, okay? They. would like to have the stability of a.

job and clarity and so on. So, when you. have your nature, you want to know that. and then find the path that is going to. be good for your nature. Then there's. the particular tactical stuff. So, if. you would ask me, should I be in the UK. or should I be in the US? Well, that. depends on a lot of things, but that's a. tactical question. So, if I want to be. an entrepreneur and I want to build a. technology company, do you think I. should be in the UK or the US? I think. you should be in the US. Why? The US has. a culture of.

um entrepreneurship, inventiveness. There's a whole different culture like. in Europe, generally speaking, and in. and and in the UK. There's an. establishment culture, right? And it. here um you could be 25, have a blue. streak in your hair, and have the. talent, but if you got the talent to. pull it off, you can get the resources. and you can be an entrepreneur. It's. There's a culture of that that means.

that it's happening more. That's why you. even see the differences in the. economies, okay? Where is the. inventiveness really happening? Okay? It's happening here. So, I would say if. you want to be an entrepreneur, this is. an environment that's particularly. conducive to being an entrepreneur. So, what is your honest perspective. about the UK at the moment? The UK has a. financial problem. Uh the government has. a debt problem. It doesn't have enough. money for what it wants to do and what. it can do. And so, what you see is the.

non-dom problem, people moving, and so. and so forth. And throughout history, when you have these sorts of things, then there's great clashes in people, okay? And the UK has been in decline. since the war. Even the development of the capital. markets, can you raise capital there? All of these things are much worse. than they are in the United States. And it leads to clashes, as you said. Of.

course, you know, there are five big. forces. that create a big cycle. that lasts. about 80 years, give or take 50, let's. say. And the five big forces are There's. a money. debt economy force, okay? Debts are. spending power. So, what happens is when. you give somebody credit, they can. spend. And then but it also produces debt. And. debt has to be paid back. And so, what.

happens is if there's not enough income. to pay back the debt, then you have. um debt rising relative to income. It. squeezes out spending. People don't want. to hold the debt assets and so on. The. UK is going through that and has gone. through that and it's connected to the. second force. And we're all going. through this in varying degrees. The. second force is the internal political. and social. force. In other words, like between the.

left and the right with wealth gaps and. opportunities gaps. We have big wealth. and opportunities gaps. So, when you. have big wealth and opportunities gaps, there's conflict. Okay, conflict between. the left and the right. And when you get. to the situation where you don't believe. the system is working for you and you. don't trust the system, then there are. wars. There are internal conflicts. over over that and so on. So, the third. force is the geopolitical force. In.

other words, there's a cycle that usually goes from. one big war to another big war. So, the. last war ended in 1945, '44, and we began a new order in 1945. And the way that works is that the. winners of the war determine how the. world order works. They draw borders. They say, "Here's how. it's going to work." And that's the new. order, okay? And that continues until.

there's a rising power challenging an. existing power in the existing world. order, which typically is deteriorating. at that time. And then you have. international conflict, okay? These. orders, there's a monetary order, they. all break down. There's an in- internal. political order, they all break down. And and there's a geopolitical order. They all have this conflict and they. work together. The fourth force it. throughout history has been acts of. nature. Droughts, floods, and pandemics, for example, have killed more people.

than wars. And acts of nature Nature has a big. effect. And then number five force is. man's inventiveness, particularly of new. technologies. Okay? Because if you see that. inventiveness, that has raised per. capita incomes, GDP per capita, any. measures of the living standards over a. period of time and and so on. But it is. also related to the first four that I. said. Those four four forces interact.

Now, when we go back to your UK case, okay, they have a financial problem. They and almost every country now is. dealing with more of that internal. political problem. For the same reasons. Wealth gaps, opportunities gaps, what do we do, who's. got the power, I don't trust the system. kind of thing. Okay, number three is we. are certainly in an international great. powers conflict, right? And it certainly. affects Europe and the UK as we're.

dealing with not only the Ukraine. situation, but the Russian situation. And what does that mean? And that. relates to the money thing because, okay, where's the money coming from to. have defense or military expenditures. and so on and so forth. So, that. matters, right? The geopolitical. matters, climate certainly matters, and. then of course technology, man's. inventiveness. So, everything can be looked through at. through that lens. And so, what does this mean for the UK.

if all other countries are going through. this as well? Doesn't it just mean that. all countries are going to suffer. equally? No, no, no, because they're not. all equal. Okay, some are more in debt. than others. Okay, some people are more. willing to hold their debt than others. Some means they they have more. resources, some are bigger and more. powerful, some are less powerful. They're different, okay? They're all. going in different conditions. Some. countries have surpluses, some. countries, you know, are not in the.

middle of where they're just having a. war. Are you optimistic about the the future. of the UK at the moment? No. No. Because it has high debt, it has the. social internal conflict, it has it's. affected by the geopolitical factors. And in terms of inventiveness, it. doesn't have the culture. that other countries have like like the. US. >> Is that it? >> Yes, the cult culture and the capital. markets to support that at a scale that.

it needs to be supported to play. seriously in the game. And for anyone. that doesn't know what capital markets. mean, basically the invest markets, isn't it a simple way of saying. >> Well, I mean, it gets you the money. In. other words, you're a guy behind, you. know, what happens is. um. we have to enable people. Okay, what what works. is finding great people, talented. people, and identifying. those who you want to bet on. And enabling them. And that works that's the most important.

force, much more important than money. Okay, because you could see. who's got the money and power and where. did they come from? Where did Nvidia. come from? Where did they all come from? Okay, they're guys like you, entrepreneur in a. sense, who's been enabled. Okay, by. because you have the talent and people. want to bet on you and that's the. capital market, so they give you money. to help enable you because they want to. bet on you and then good things happen. But are you are you optimistic about the.

United States at the moment? The United. States is very much a big picture. No, I. think it's very much in this issue. This. So, if I go down my list, it definitely. has this. debt money economy problem. We can get. into that, okay? It definitely has the. internal conflict power in which there. is a fight between the left, you know, the hard left and the right due to. wealth and values gaps and people not. believing that the system will work for.

them. And so, democracy is at risk. because they don't believe the they're. not going to follow the rules in the. sense they don't believe the rules are. going to. number three, it's of course the leading. one side in this great power conflict of. the world, right? In other words, yes, between the United States and the one. side, let's say, and China and the. allies their allies on the other side. I. mean, in the news you just saw the. meetings of Xi, Putin, Modi and that.

group over there walking down, you know, and okay. So, now it should be pretty. clear how the sides are lining up. Okay, you it's always better to be in a. place that's not in one of those wars. Like, stay out of wars. And of course, climate has an effect. And of course, then we have technology. The United States and China are in the. big technology competitions. The others. are really not in the game, they don't. have the money, that this innovation and.

talent in a sense to play at that scale. and so on. So, we have a great, you. know, technology. war which can be used to create great. advances, but at the same time could be. used for great conflicts. And so, now. the question is going to be who wins the. technology war because the winner of the. technology war is going to win all wars, okay? In other words, they'll win the economic. war. They'll win the geopolitical war because.

technology. And I'm not saying anything. that hasn't repeated through history. Give me that historical context if you. can just for for. The technology, for example, nuclear. Yeah. Nuclear. won World War II. And and does this cycle go back further. than just. >> Oh, no, it goes back. that book, okay. Um in order to understand these things. because I have to bet on what's going to. happen. I'm a global macro investor. I.

studied the last 500 years of history. And it happens over and over again in. all cases. Oh, so I could take the British Empire, I could take you through all the. empires, but the Dutch Empire before. that and all this and it it it it. happens all the time. I watched your I watched your videos. about this and it's truly fascinating. how predictable this stuff is and. the work that you've done to uncover. this trend throughout history. I mean, it's almost for me it was almost. irrefutable watching the evidence in in.

things like a 40-minute video on YouTube. where you show how this played out. through empires. And it begs the. question, you know, cuz. when you live in the United States, when. you're when you're in the present time, you almost never assume that the empire. you're in could fall. You just don't you don't see how it can. happen. We're so strong, we're so great, you know, we're so that doing AI over. here, have money over here, everything's. good, the sun's shining. Of course. People always think that the future. would be a slightly modified version of. the present.

And it's not. Okay, watch over decades, but it's like. watching a. person grow. Yeah. Okay. Yeah. You know, you watch your kid or you watch a person. any age, any age, and that's what you. see. Yeah. Okay, and you don't see the. life arc. Yeah. Okay, but the life arc. is in irrefutable. But the you do do you. think it's conceivable that in the next. 50 to 100 years the US could no longer. be the dominant power globally? Yeah.

Yeah, more than conceivable. More than. conceivable. What do what do you what do you mean by. more than conceivable? I mean that these evolutions always take. place. And they take place in a certain way. And that. if you look at the. probabilities. and the paths and the symptoms, there is a challenge the United States.

is facing a number of those challenges. And we're at a moment where um. it's a question of whether the system. and. the people. could can get control. of the situations and deal with it. strongly. and well. in a way where they are not.

fighting. to the point of. damaging each other and damaging. the prospects for the future. But I mean, the United States is very. innovative. Got all these great innovative companies. here, so surely Yeah, but you can't make. generalizations about the United States. and you can't make generalizations, by. the way, about the markets either. Um. what you see is. um. 1% a small percentage 1% of the.

population. If you're looking at the. breakdown of incomes and also you're. looking at the innovation, the stock. markets, which stocks are doing well, who owns those companies and all of. that. About 3 million people in a. country of 330 million people are really. unbelievably doing great and you could. pick the. neighborhoods they're in and what. they're doing. And then there's the top. 10%, let's say, which is the people.

around them and they're really really. doing great in that world. At the same. time, the bottom 60%. 60% of Americans have below a sixth. grade reading level. Wow. And that population. in terms of. the basics. being productive. you have to be productive. and be prosperous. So,

what what you need to have a succe-. successful society is to have. broad-based productivity and prosperity. Okay, and that's a problem. Okay, so which America are you looking. at and are you watching the war that's. happening between these? It's a little bit complicated for me as. a as a bit of an outsider because I see. Trump. saying he represents. those people.

But obviously Trump is a from the. billionaire class himself. So. I mean is he is he a savior for. inequality? Is he correcting in I think. I think he sees a lot of the problem and. he I think he sees the debt problem. I. think he sees the internal conflict. disorder problem. And I think he. represents. the red let's call it the red states. I. mean you look at a map and there's red. and blue and you see where they are. Okay. And he represents that and they're.

united behind him in terms of doing some. things. Okay. So he represents let's. call it the red side which is located. where the maps shows red and then there. are the blue and and he's. he views himself as somebody who needs. to take charge and to do certain things. Others in that population would say. those who let's say are not getting or. having the food stamp program cut off.

or having other programs cut off that. they're dependent on. would say. well a second that's not representing. me. And so we have gone that population has. gone to significant number behind him. That are. devotees. They're all in. Okay. At the same time as we have the. other side which will have their.

devotees. If you know we're in New York. City. Okay. And the up to upcoming mayoral. election will be an example of the two. sides. Okay. And they will. try to use the system but there's a. question. Will the system have enough. support to work? Okay. But that's what. we have. Just just to close up on this. point of the UK in particular. If if you. were to try and fix it, what would you. be aiming at? I say this because we do.

have a millionaire exodus that's widely. reported in the UK where I think this. year was set to lose 16,000. roughly 16,000 millionaires. When you look at the big big countries. like China, America, the UAE, the UK, we're losing more millionaires than. anybody else. And I was wondering if you. think it's fixable and if you were in. charge of the UK. what you might aim at first. It's difficult you know. First of all, if you go back to the basic problem. which is there's too much debt.

there are deficits. there's differences in. education and opportunity levels. and so on. The most important thing that you can. have. is a strong middle. Political middle? Political middle. To be analytically strong. and also strong enough.

to get the people to do what needs to be. done even if they don't want to do it to. get to be productive. Now that's an easy thing to say. It's not an easy thing to do. But you do. need that strong middle and you do need. to convey to people that you need to. have the strong middle to change. productivity. And you know and are you in it? Are are you in it? Are you patriotic and.

in it and you know. But you look at. history. how did the United States come to be the. United States? People will go. to the places. that are better. than them than stay in the places that. worse for them. This is fundamental, right? Incentives. Okay. So you have to. make the place. better. Okay. Now I would say also you can take. pockets. and they go into the pocket and let it.

spread out but you also have to have. this. equal education or you know you've got. to strive for equal opportunity. But. anyway, it's a difficult question that. I'm afraid. I'm incapable of. um. solving. It was unnerving to hear the tone of. your voice drop when I asked it. You. slightly um. as if you you've kind of given up on the. UK a little bit. Your facial reaction. >> No, I'm I'm just a I'm just a.

I'm a practical guy. I'm a realistic guy. I made my money. I'm in the business. and it's my nature. to try to be realistic. And to bet on how things will transpire. And that's not healthy. The situation in. the UK is not healthy. And the situation. in the United States is very risky in. many ways. It's what we're describing. So you know and then if you look where.

are people going. then then you see the places that have. the qualities we're talking about. They're civil. They're creative. The people aren't at war with each. other. What happens next. in history? Well, usually there's a big fight for. control. Political revolutions and things like. that. The system breaks down.

because they don't trust the system. So. will the legal system resolve that? Will. the parliamentary system resolve that? That these disputes. satisfactorily. to the satisfaction of those people and. the other people who have different. points of view? And the sides won't believe it. This. goes back. this goes back to Rome. It goes back to.

Caesar. You know, the Senate. You know, this goes back through history. all the time. Right? And and then the. 30s four major democracies. chose to be autocracies. Okay. That. happened in Italy, Germany, Spain and. Japan. What's autocracy for anyone that. doesn't know the word? Well, it it means. a dictatorship. essentially. of a limited number of people at the top.

who are autocratic which means that they. are directing things rather than a. democracy. in which. there's representatives of all different. points of view that get together and. follow rules to make decisions. So the UK could become an autocracy. as could the US I guess. Um you're going to see a lot of pressure.

for that strong leader who will get. control of things and make it work well. And will and you're likely to see. two different views. as to which side you know, the red and. the blue sides so to speak. You're. likely to see that type of. clash. You said the US is playing a. risky game itself. Is that from a debt debt perspective or. otherwise? >> Well, from these things. Okay. >> from the internal conflict from the.

changing world order, the geopolitical. world conflict. You know, I don't know. We're playing with nuclear weapons and. in wars in different places and then of. course climate and then. the technology war how we're doing that. You know. I saw that image the other day. of Putin and and President Xi in China. together walking together. If China does. become the dominant force in the world.

the dominant power. does is that a smooth transition? First. of all, I don't think. either side is going to be the clearly. dominant power for for a very long time. Um and the. the quickest way. to have it is some kind of a war and. that's a dangerous thing. And but maybe. it evolves. hopefully the way the Soviet Union of. evolved that the the worry of mutually. assured destruction.

keeps everybody. not having. that kind of war and then then then the. systems one system or another system. wins. But that's an evolutionary process and. you know I can't say and. um. Do you think much about time frames and. cuz I when I was watching the fifth when. I was going through the changing world. order, there seems to be somewhat. consistent or predictable time frames. when these things these transitions. happen. Do you think about where we are? >> Well, they're long-term big cycles.

Yeah. Right? It's it's like a life. cycle. On average they are about a life. cycle about 80 years. But it's not. predetermined just like your life cycle. is not predetermined. Like if you take. care of yourself and you you know I. don't know don't smoke, eat well, exercise and so on so forth then you. will probably have a longer life cycle. than if you don't take care of yourself. and it's kind of like that you know. And.

so you see them in history they evolve. but you can see the symptoms. Okay. You can see the actions and the. symptoms. Which like taking a physical. then gives you a sense of where they are. in their life cycles. What 80 years from. World War II. 80 years from World War. II, yeah. And you're seeing the symptoms. Yeah. Symptoms are clear. They're all in that. book. You can see the charts of all the. systems. Is it something to be worried. about or concerned about.

if you're in the United States? No. Yes. And then the question is how you as an. individual handle it. How do I as an. individual handle it? Well, first of all, I think. I think you have to be aware of the. situation and the risks. For me and my family though, in terms of. risks. and how I should um. counteract those risks. Is it a case of. me saving for a rainy day? Is it a case. That's part of it. Yeah. Um.

there's a there's a saying in Hong Kong. um a Chinese saying which is a smart. rabbit has three holes. And what that means is. you can see is it the UK or the US and. uh and I can then move to the better. place and get out of the place that's a. terrible place. So, can I successfully. be an immigrant or whatever and change. my location? Throughout history, that's. been important. So, the ability to go to.

good places. and away from bad places. Um so, that's part of it. Um secondly. building your financial strength. is important, which has to do with how. you earn, spend, and save. That will. determine. the amount. And then, what you do with that amount. is invest. And so, how you invest.

uh is also important. So, if you have your financial ability. and you can make the move and then you. have knowledge. you know, about what's happening. so that you can change things. Those are. the things you need. So, on that first. point about a smart rabbit having three. holes. is it therefore. a better decision at this point in time. to not. to not buy a house?

Because a lot of people end up buying a. house and it anchors them to to a place. and it means that they then have to pay. into a mortgage. So, a lot of a lot of. financial advice most of us have growing. up is when you get enough money to buy a. house, move in, pay that mortgage for 25. years. But if I'm in a new economy in a. new world and flexibility and the. ability to get up and go and move is uh. there's there's uh value to that. The. ability to move capital matters. And if. you look at history this has been an. important consideration. Yes, so it.

matters. So, if you're nailing yourself. down and that's your primary capital and. it's nailed down there, then that's. those limit your flexibility. And on the point of earning, spending, and saving. wondered what you you're a You're a a. father, aren't you? Yeah. What what advice are you giving to your. children about earning money in the in. the current world? Where where they should set up their. shop, the skills that are most valuable. to acquire, the technologies, the we. talked about the US being a place to. one of the better places to build your.

career. for all the reasons you described. Well, that's. You know, that's kind of like the. particular that you asked me for that's. below the level of the higher level. Okay? The higher level is I have a. principle. Make your work and your. passion the same thing and don't forget. about the money part. Okay, if you make your work and your. passion the same thing so that you're. really enjoying your work.

you'll have an enjoyable, satisfactory. life and you'll probably be better at. your career. That um as a result, you. probably advance and so on. So, you have. a happier life and you will have a more. probably a more successful life. But it. is true that the careers that you choose. will have financial implications. Mhm. And if you say I want to be a poet or. something along those lines, you better. consider the financial implications of.

that. That doesn't mean that you have to. go make a ton of money cuz I think that. that's I think a lot of people fall into. that trap that they think the money is. um like vast amounts of money is vast. amounts of success and that's not true. In other words, is your work and your. passion the same thing? So, I think that. what brings people happiness is. meaningful work and meaningful. relationships. Mhm. Okay, if you have meaningful work, you know, that you're into and you're.

what you know, your passion and your. work's the same thing and you have. meaningful relationships whether through. that work or beyond you going to have. probably a great life, okay? And so, you. have to keep that in mind and it doesn't. have much correlation past a certain. level of money Mhm. uh it doesn't have. much correlation with um that well-being. with the amount of money you have. And. if you see studies across societies and. you'll see that past that certain basic.

level, there's no correlation between. the amount of money they have and how. much happiness they have or well-being, okay? That the highest level of. correlation across societies and studies. of happiness and well-being is. community. Do you have a sense of community? Do you. have those around you who are your. community? You'll live longer that way. You'll have a more joyous life and it'll. be a better outcome. But anyway, so. thinking about those things I think is. important.

Based on your life cycle in this book, Principles: Your Guided Journey, Create. Your Own Principles to Get the Work and. Life You Want. do you think you have to play different. games in different seasons of your life. cycle as it relates to generating. wealth? And what I'm talking about here. is really like risk profile um or what I. should be optimizing for. Should I be. Should I be trying to hang around with. Ray Dalio or should I be focusing on the. job that pays me the most? First of all, yeah, the answer is yes. And uh the second question you asked the.

answer is um that you should be around. the. the people who are the best people to. teach you, to operate by them, the. mentors, and the learnings, and so on. You should be around the best people. And when I say best people, I mean. people of good character and good. capabilities, okay? And uh so, you. should be around the best, not the job. that pays you the most.

And I could explain why that is, but and. yes, in terms of that arc, you will play. it differently at different parts of. your life cycle. So, in the early part. of your life cycle, what you're going to. do is I mean, the more. learning and experiencing is the most. important thing that you can do in the. learning in the early part of your life. cycle. It's like you're going to make your. choices. What direction am I going to be. in and so on and so forth. So, learn, okay? That's that's most important. And.

then once you're at the end of your life. cycle, you're pretty much relieved from. all of that. You're not going to be. working to earn, okay? You're going to. be free of all of that. You're going to. have. um and you have freedom of choices and. so on. And you're going to be thinking. about transitioning. How do I transition well-being or how do. I transition my wealth or how do I. transition and so on, you know? That's. that's where you are. Still learning is.

a joy. but at the same time in terms of trying. to accomplish it's not the same at your. late part of your life cycle as it is in. your early part of your life cycle. So, I want to ask about your early life. cycle and what the most important. strategic or wealth-generating decisions. you made. that you would encourage everybody to. consider if their nature is aligned to. yours. >> Okay, my nature was I hated school. I didn't like.

the whole thing of remembering this and. remembering this and then give it back. to me and there were these uh you know, history like there's William the. Conqueror in 1066 and what did he do and. you know, like all of that was what. education represented. And when I was um. 12, a kid I earned money with odd jobs. like um I had a paper route and. um I mowed lawns and I caddied and I.

took my caddying money and when I was. 12, I got everybody was talking about. the stock market. So, I put some money. in the stock market. I didn't know what. I was doing, of course, but I um I. picked um the stock. It was the only. stock I ever heard of that was selling. for less than $5 a share and my. reasoning was I could buy more shares. So, if it went up, I could make more. money. Okay, that was a stupid criteria, but it.

was a company that was about to go. bankrupt and another company acquired it. and it tripled in price. And I said, I like this game. So, I got I got hooked on the game. I'm still hooked on the game, right? So, I liked it. Okay, that that affected me. So, I barely got into uh CW Post College. and then I went to uh Harvard Business. School and that opened my eyes to the.

world in the in many ways because of who. were there and what it was like and all. that, you know, the best and the. brightest kind of thing. But I always. still. traded markets cuz I always played the. game. And I can tell you stories that you want. me to couple of quick stories? >> 100%. >> Okay. So, I'm clerking on the floor of the New. York Stock Exchange between graduating. from college and in the summer between. graduating from college and going to.

Harvard Business School and that is 1970. summer of 1971. And on August 15th, 1971, Richard Nixon. gets on the television. and says. that you know the promise that that you. were going to be able to take your paper. money and go get gold, you can't do. that. And we're not we're going to cut off.

that off. He didn't say it in exactly. those words, but money then was gold. And what we think of is paper money, fiat money, was claims on the gold. So, I walked on the floor of the New York. Stock Exchange that summer and I thought. the market was going to go down a lot. and the market went up a lot. And I didn't understand why cuz I never. went through a devaluation before and I. studied history. and I found that. in March of 1933,

Roosevelt got on the radio and made the. exact same announcement that you're not. going to get your gold and they're going. to print the money and when you print a. lot of money, you have that. Okay. So, I learned. that history. of things that never happened in my. lifetime before were important things to. understand. Okay. I went back. then to Harvard Business School to for 2. years and and 2 years later, as a result. of all the printing of money and the oil.

shock because of all of that, uh we had. the I in 1973 oil shock. And now because of my background, I'm. head hired to be director of commodities. at a Wall Street brokerage firm. Okay. Mhm. Which and then. all sorts of things happened. Um. turbulence and so and so forth. That. firm went broke. I went to another firm. and I was.

uh rowdy. I wasn't your typical good. employee, you know, follow everything. and so. So, I got fired. And that was in uh 1975. And then I but uh clients all liked me. and and for things and so, they would. pay me for advice and I continued to. trade the markets and that's when I. formed Bridgewater. Okay. And what happened? >> That was 1975.

I just passed along Bridgewater 50 years. later. Yeah. Okay. So, there's a journey there. that has failures and successes and. learnings. You know, I have a principle. Pain plus reflection equals progress. Okay. Your best learnings come from the. pain. It's a message. Pay attention. Learn how reality works and how to deal. with it differently so you have. principles for real dealing with reality.

better. And I learned that process and from that. process, my company Bridgewater became. the largest hedge fund in the world. Um. extremely successful. Managing how much. at 150 billion dollars. 1,500 people 150. billion dollars. And that's made you a. very wealthy man. It made me a very. wealthy man, which by the way, was not. my intention. Okay. I just wanted to play the game and. to have meaningful work and meaningful. relationships. That was paramount, but.

it happened to be the game I played. If. you're good at the game, you make a lot. of money. And now, I'm in a stage in my. life where I'm. I want to pass things along. I need to. pass things along, right? So, hence the. books, hence our conversation. and here we are. That's the life arc. But I learned a lot. and so that's the journey. I think B2B marketers keep making this. mistake. They're chasing volume instead.

of quality. And when you try to be seen. by more people instead of the right. people, all you're doing is making. noise, but that noise rarely shifts the. needle and it's often quite expensive. And I know there was a time in my career. where I kept making this mistake that. many of you will be making it too. Eventually, I started posting ads on our. show sponsors platform LinkedIn and. that's when things started to change. I. put that change down to a few critical. things. One of them being that LinkedIn. was then and still is today the platform. where decision makers go to, not only to. think and learn, but also to buy. And.

when you market your business there, you're putting it right in front of. people who actually have the power to. say yes. And you can target them by job. title, industry and company size. It's. simply a sharper way to spend your. marketing budget. And if you haven't. tried it, how about this? Give LinkedIn. ads a try and I'm going to give you a. $100 ad credit to get you started. If. you visit linkedin.com/diary, you can claim that right now. That's. linkedin.com/diary. Just for context, people don't like. talking about money and I understand it,

but you're a prolific philanthropist. Also, Google says that your net worth is. in the tens of billions of dollars and. I'm sure there's some people that have. clicked on this conversation and aren't. aware of the scale of wealth you built. up in the scale of Bridgewater Capital. and how prolific and famous it is. in the investing world. In that 50-year. life arc, one of the things you. mentioned is pain. All of us will encounter pain. And you said pain plus reflection equals. progress. How have you learned to deal with pain?

You've had a lot of pain in all facets. of life cuz you've lived the life arc. and you continue to. How what's the best. principle for dealing with pain? The first of all, um to calm yourself. down. and to get centered. Meditation has had. a big beneficial effect on my life. We can get into meditation in a minute. of how it has, but the ability to, you. know, in a sense, calm yourself down. and when the time is right.

to reflect on. what's happened. both to understand how reality works. You know, you want to be a hyperrealist. I understand how reality works, therefore I need to do this under this. set of circumstances, which means developing principles. And. so, what I did. when I would do that anytime and. whenever I would think, what what should. I do, whether painful or not,

I would pause, reflect. on, you know, what should I do if that. happened again. and that's how I would write down my. principles. And what I did was I wrote down. a lot of principles. >> principles. A lot of principles. If this. happens, that happens and whatever. And then so, I wrote these principles. down. and then I found that in investing, um if I can computerize. those. decision rules,

I could back test them, see how they. would have worked and so on. So, I built. systems, decision-making systems. Um. computer would make decisions. So, it. was AI before LLMs, but it was AI to. have decision-making criteria. So, it. would be like I I would make a computer. chess game. that would play while I was playing my. mental chess game. what moves we would make. And it's completely automated and so on.

But I'm what I'm trying to say is that. reflecting on how does reality really. work. and what do I do when this happens to. that happens is the development of. principles. And that has been invaluable and it also. makes me see things differently. Because a lot of people um. and if I didn't do this, I would be. seeing almost as uh. a blizzard of things coming at me.

Instead, I see everything as another one of. those. So, let let's say for example, it it's a species. So, it's like seeing, okay, that's what kind of species is it. and how do I deal with that species? So, it's one of those rather than just a lot. of things coming at me. Pattern. recognition of Yeah. But but let's say. if you think of a it's a duck. Okay. Okay. Okay, it's a duck. How do I deal with a.

duck? Or it's a lion. Okay, how do I deal with a lion? You're. being very strict. >> than just a lot of things coming at it. So, this principle thinking. and seeing it that way had a big effect. on. the quality of my decision-making and. and that helped. Two questions I had there is to become a. principle thinker, I need to do more. reflection, right? And then the other thing is. >> Yeah, think about how does. how does the machine, how does how does.

life, how do these things work? So, that's what I mean. Okay. And to. write that down. >> Uh. yeah, write write down your thoughts. I. find. sometimes what I would do is I'd uh. dictate them into my iPhone. Okay. Okay. I'd say, okay, this is how When you're making a. decision, why did you make that. decision? So, not just make a decision, but think. about the criteria you're using to make. the decision.

Also, my emotions, my trauma, my. insecurities, my anxiety. Right. And and. you might say when reflecting on that, is that helpful? Is that harmful? And what do I do about that? Like, for. example, when what you're referring to. is, yes, that emotions and the things and all of. those um we you have to understand that. the basically the brain's got two parts. to it, right? It has the logical.

part of your brain, reasonable, tries to. reason things through, and that which is. conscious. And then it has the. subconscious mind, which is the. subliminal that is really driving you. And so when you can. reflect, okay, how are my emotions entering into. it? What do I you know, and so on, and you. can think and you can align that. That's. very powerful. And meditation, by the.

way, naturally does that, because what. you do when you meditate and maybe a. time's coming I should explain. meditation. Okay, how it works. Um. what you do is it's a process by which. you sit quietly. and you repeat in your mind what is. called a mantra, which is a sound that. it's a word that has no meaning. Let me. say the most classic example of that. would be om. Okay, so you quietly there. and you go.

with your breath you go you know, om. Om, like that. But you need to be. taught. But anyway, I. om and so when you're doing that. uh because you're om is in your mind or. your mantra's in your mind, you're not. able to have other thoughts. You'll see yourself wavering between. doing that and staying on the mantra and. then having thoughts. Um but and then you go back to your. mantra. When you are.

uh in the mantra a a lot, then it. disappears. The sound disappears and you go into. your subconscious mind. That's what they call transcending. Transcendental meditation is the type of. meditation I do. And so you go there and you're not in a. conscious state and you're not in an. subcon- unconscious state. You're in a. conscious state. So it's subconscious. state. It's not unconscious is you're. sleeping. Conscious is that you're awake. like we are. You're in this. So it's a.

different state. Like if you hear that. noise, you would hear that noise. It. would be big. And not when you're. sleeping. But when you're in your. subconscious state, then it's relaxing, uh it's helpful, and this process helps. to. um. bring. your conscious state and your uncon-. subconscious state into alignment. In other words, you recognize both. and it calms you down.

It's like a the ninja in the ninja. movies, you know, they're fighting, but. they it seems in slow motion. The camera. shows them in slow motion and they're. doing whatever they're doing along that. It kind of makes you in that kind of. state of mind so that you're dealing. with what's coming at you in that way. And so what you referred to is this. um these things that happen, and how you. deal with those is really important to. the quality of your decision making. How.

influential was transcendental. meditation in your success? Oh, enormously successful. I enormously. significant. Ver- very very significant. In other words, that way of singing. seeing things. And how often And and by. the way, there's you know, there's. uh. I I would say. there's a Serenity Prayer. The Serenity Prayer. is God give me the serenity to accept. that which I can't control. and give me the power.

to control that which I can. and the wisdom to tell the difference. Okay? And so to how you approach these. things, we're talking about reflection. You asked me reflection, okay? If you. can reflect in that quality way, then you deal with anything. And I've. I've dealt with. uh the worst possible thing. Um I lost a. son. Okay? And I would have rather died. I.

would have rather lost everything to. lose my son. So it's the worst possible. thing. And and then to see what it did, you know, the damage and the harm and. fear from family, terrible. Okay. Then to go through that with meditation, with reflection, and so on, uh was invaluable. And people have their. own challenges, but to be able to do it that way, I I really urge your audience, I urge. you, to uh to learn that. That's very.

helpful. How how did that tragedy change your. your perspective and your your. principles in any way? On life, on on. happiness, on success, on all these. things that you've written about. Well, it's again I you know, I go above. it. and uh you reflect on the life arc. And. I realize at that higher level. that that's. what the life arc is like. If you'll In.

in all my books there's this. ar- um arcing. This arcing here. There's a bigger. version of it. Uh yeah, there's this arcing. Okay, I don't know if your camera sees. that. Okay, whatever it is. And that's. what life and evolution is like to me, meaning you make advances. You will have setbacks. Okay? If you reflect well.

and you learn how reality works and how. you will deal with it, you will get past that. and go on. And that's just what it is. That's just. the way life is. And if you do that well, then that's your best possible life. Are. you religious? Are you a religious. person? I'm not religious, but I'm. spiritual. Okay. The Dalai Lama, who I. had the pleasure of meeting, told me uh. and I I agree with.

um that religions are typically. um a mix. between superstitions. and spirituality. There's half of it is. that element that nobody knows, but. there is. the way people should deal with each. other. There is karma. Okay? All religions. there's a part of them. that says.

do unto others as you would have them do. unto you, or what goes around comes. around. And then you get to the. particulars, okay? And it is true. that if we work well together, that. even little things I can do to help you. can make a big difference in your life. And little things that you can do to. help me make a the big difference in my. our lives. And so it's practical and it is also.

joyous. Okay? That creates a relationship. And. we talked earlier about how that. meaningful relationship is like the. source of great happiness. But when you. have a community and you do that, you. have a better society. And almost all. religions will tell you that. There'll. be elements of those. And when I believe in spirituality, what. I also mean is. um we're all part of this greater whole.

Okay? We're all part of the greater whole. And. if you could see yourself as part of the. greater whole. and love the greater whole uh and. whatever, that is spirituality, really, okay? And. so I will go through my life arc, okay? And I will die, and I'm. comfortable with that, okay? In that, okay, it's all. part of the greater whole you know, nat-. nature and whatever it is. That's true.

I can't tell you about other things, but. I do believe in the things I just told. you. When it comes to living a a successful. life, you we've talked about having. dreams and understanding your nature and. aspiring for things and then. understanding reality, which. transcendental meditation's a great. mechanism and vehicle to do. Um and in your in your book about a. successful life, you talk about plus. determination. Plus determination. Hard work. If I want to be a successful.

man or woman, how important do you think hard work is? Well, gives you power. It's very. important, right? Some people some. people, you know, I'm not saying they want to choose it, but the iron- the irony of things is. there are first order consequences and. there are second order consequences. This is like a rule of life, okay? And. most of the time the first order. consequences, whether they're. likable or not,

has the opposite second quarter. second order consequences. So what I. mean by that is. like eating. or exercising, okay? Eat the foods you like, second order consequence is probably not. going to be good. Um. you know, I don't want to exercise. Um the second order consequences won't. be as good, okay? Working hard, which gives you strength. Where does.

strength come from? I mean. strength comes from working hard. So, working hard will will give you. power. Power will make things easier and make. things better. That's just the way it is. And being open-minded while you do it? Something that was really important to. you. >> Yeah. I say. importance of being open-minded and. assertive at the same time. Um. I I.

I watch. people becoming so. tied to their own opinions. Like this is the greatest tragedy of. mankind. The greatest tragedy of mankind cuz it's. so easily can be fixed. is. holding a strong opinion. that is wrong. that you. could have made right. better.

if you were open to learning more. If. you were said I want to be stress. tested. I want my thinking to be stress. tested. I want to make sure that I'm. making the better decision. And so I'll. be challenged. But a lot of people view. that challenging like a fight. It's not a fight. If somebody holds a. different opinion, it should prompt a. curiosity. You know, I don't know. Am I wrong or is. they wrong? It's a 50% chance. I don't. know. Maybe I'm wrong.

So, it should prompt curiosity and an. exchange to try to make sure that you're. seeing the whole picture and so on. But. subliminal instincts are I'm going to. stick with it and I'm going to have a. fight. That's the problem. Because there's too much on the line for. so many people to to It's subliminal. It's It's It just goes back to the mind. thinking. that the intellectual challenge is a. fight. And it's egotistical, you know, ego.

I must be right. As an As an investor. and entrepreneur, that's obviously. particularly important because. you're constantly dealing with new. information and feedback which you need. to. be flexible. >> That was one of the two things that. changed my. uh. my my my whole direction and made me. successful. I get I can't explain it if. you want. >> Please. 19. 79 and 80. I had calculated that American banks.

had lent more money to foreign countries. that they were going to be able to pay. back and that we were going to have a. debt crisis. Very controversial point of view. In. August of. 1982, Mexico defaulted on its debts. And over the next decade, many other. countries did and it caused bank. problems. However, at that time, I thought things were. going to get bad and that was the exact. bottom in the stock market, August 1982.

So, I couldn't have been more wrong. I. lost money for me. I lost money for the. clients. I lost money. I was so broke. that I had to borrow $4,000 from my dad. to help to pay for family bills because. I was faced with the choice, what am I. going to do? And And do I. Do I go back to. work on Wall Street, get a. uh. tie, get on the train and go back that. which is again not in my nature or.

whatever. And And two things changed me. Okay, reflection. First of all. um I learned what we were just talking. about. I learned humility. A fear of being wrong. And open-mindedness. So, I wanted the smartest people who. could I could find to stress test my. opinions. Cuz I'm always realized I could be. wrong. And then I learned how to diversify my.

bets so that I could dramatically reduce. my risk without reducing my returns. Okay, that was the bottom. Okay, from that point all the way over, that following those principles took me. to the biggest hedge fund in the world, the most successful and so on cuz I. applied it to the market, applied it to. what we did and so on. So, that notion. of reflection and then how do you deal. with what reality is like and then, you.

know, okay, the Learn Learn radical. open-mindedness. In other words, unlike. there's a principle in the book, you. have to take in before you put out. Or that um. decision-making is a two-step process. First, take in, then decide. Okay? So, yes, open-mindedness. you don't doesn't in any way minimize. your ability to decide. So, you still have the freedom to. decide, but it's crazy not to be. open-minded.

You recognize that the biggest threat to. good decision-making is harmful emotions. and that two-step process is first learn. and then make the decision, which is. funny cuz it sounds simple. But when you. said it, I think about all the worst. decisions I've ever made in business and. I missed step one. I forgot to I forgot to take a minute. and do the evidence gathering or the. like information gathering process. >> Yeah, just smart people care about your. decision. Say stress test me. Why don't we do that? That ego.

and also instinct that that's a fight. Is there any advice you would give me on. becoming a better decision-maker? So, I. have a fund, I have many businesses. Is. there any sort of practical. simple foundations of becoming a better. decision-maker that we haven't talked. about? Get smart people to interrogate. my thinking. Um be open-minded. I think we've talked about almost all of. them. Um. I think then you have to then know about. how to leverage yourself.

Okay? In other words, as you do more and. more. uh how do you do more and more when your. brain has a capacity limit? Okay? And there's only certain number of. hours in the day or the week. Okay? You. have to know how to do that. >> Is that focus or is that something. No. It's knowing how to do it through. others. Okay? It's knowing how to pick others and. orchestrate we- well. It's like uh.

running a symphony or whatever. Okay? Get the best players. Okay, when I say you know, um good. character and good capabilities. and orchestrate them well. And then provide that um that leverage. Like I um. when I was doing the most, I had 30. direct reports. Whatever the number is, it's only at. it's the process is how to get more out. of a minute or a day.

Not how to work harder. Okay? It's how to leverage yourself. And. you're going to leverage yourself by. picking the right people who you can. trust. They're not going to screw you. They're going to operate in your. interest and they're going to be. capable. And so, a lot of people, what. you can do is you can deal with them and. then you can say like I I would deal. with them on this 30 reports. I'd have maybe um. an hour meeting with them once every 2. weeks.

And And they'd go off and do things. And when you do that, you can even find. people who are much better at things. than you would be if you did them. Because if you have these different. things. okay, you better because otherwise you. don't have the capacity. You have these two. key challenges to to overcome as an. which is find these great capable people. that have great character and then like. bind them with the right culture to make. sure that they do the best work. Right. And And in other words.

it's meaningful work and meaningful. relationships. through radical truthfulness and radical. transparency. Radical truthfulness and transparency. Okay. First, if you can have um. meaningful. work and meaningful relationships, the. people are on the mission with you. Wow, that's fantastic. But. y-.

You better be truthful and transparent. That'll show that you're honest and you. better because you have to get a truth. including what people are bad at. and how to deal with all those things. How Uh and And most people hide them. They don't bring them out into the open. Okay? They'll Everybody's worried about. hurting each other's feelings or. you know, uh that. And then so they're. not honest with each other. And And they're That's the barrier. You. We talked about the barrier of. disagreement. There's It's like that.

Okay, um you know, uh I don't know. Are. you good at that? Are you striking out? If you're striking out and what is it? How do we deal with it? You better talk. about that clearly cuz you need to have. an A team of players. You know, you have. to work yourself so that your team is an. A team of players who are tight. How did. you do that Bridgewater? How did you. make people honest? Uh well, uh fir- first of all, um I had. a policy, talk behind another person's. back.

um critically. That happens three times, you're out. And then I would have radical. transparency so everybody could see. everything. So, you could see why I'm making. decisions that I would reflect. But the main thing. is, you know, you know if it's happening. or not. Okay? And I made that comfortable. because that's un- ordinarily. uncomfortable. We talked about the fact that there's an. intellectual you and there's an.

emotional subliminal you. Okay, I made. them understand like if I had a team, a. football team, and so on, that this is going to be better for the. team, it's going to be better for you. and you'll have your evolution because. what do you want to have dishonesty? Do. you want people to think one thing about. you and really say something different? How is that going to work? So, there's. an intellectual. okay, we believe it. And then also by.

having the meaningful relationships. I. mean, I'm not I don't force them. I create a. culture of meaningful relationships so. that they. have known each other for a long time. They go go to each others parties or. they go to each others. their are funerals, there are baby. showers, there are these things. Not. that anybody's. I I created uh clubs. I said any club. that you want to create that has more.

than. 20 people, um whatever it is up to $500. per person, I'll pay for half. So, so I don't care what it is. If it's. play softball or play chess or whatever. it is that you're enjoying each other's. company or you want to go to. ball games or something. I don't care. what it is. I'll pay for half up to that. up to $500. So, I to. nobody has obligations to or something.

But if I have that kind of meaningful. relationships, so you can talk honestly. with each other. I found that very helpful. And you built. a famously built an idea meritocracy, which in my understanding means where. the best idea ends up winning in the. company versus just your idea because. you're the most powerful person in the. business. >> Right. I mean, I want what do I want? I. want the best idea to win. This sounds. simple but but again, it's it's not how. businesses operate. One of the. fascinations I've always had is that.

when businesses get bigger and they have. more intellectual horsepower by I mean, if you just added up how many brains. they had, they sometimes get less. innovative and. it it feels like the the CEO. >> Well, because they become more more. bureaucratic and more fragmented. Yeah. Okay, there's I found it to be true and. it's well established fact that if you. get a group of people past a certain. size, which is 75 to 100 people,

um they don't know each other. Okay, they they they start to become different. and then. you lose those relationships, you lose a. lot and so on. I found it because I. at the holiday season every year, what I. would do is I would write everybody. notes, long notes in in their cards and. I would pick an individualized holiday. gift for them. And when it got to be the. 67 people, I remember the year, it broke.

my back. I mean, I I just couldn't do. it. Okay, and I realized that at that. point, I was. going into another frame. Okay, and so. it's a organizational reality that you. can keep that group and then what you. have to do is then you have different. those different areas and you have to. create cohesiveness between those. different and. cohesiveness, common mission and how do. you do that between that? So, like for.

example, when we'd have our holiday. party, where it used to be everybody. would be. you know, sort of go in and you have a. holiday party and everybody together. What I found out is we had a big arena. that we would go to and I'd have both. I'd have okay, that department is in that area and. whatever and then they come out and they. all mingle together and so on. So, there's an organizational. thing that you've got to realize in. terms of culture and and management of.

that. >> It's like villages in a city, I guess. Like you basically keep build the. villages and then. >> Good example, yeah. Interesting. Okay. And yeah, yeah, all media companies are. at that exact point now. It's at it's at. that 90 90 odd people. >> Okay, there you are. >> you said 75 to 100, I was like, ah. interesting. >> Yeah. I was thinking about all the. things I should be doing now to. counteract some of those adverse effects. of the culture splintering or. relationships breaking down, but I guess. you've described it there. Uh. interesting. And I have to say, one of.

the things that I found to be most I'm. 33 years old. I just turned 33 last. week. It's crazy how. how often people say that hiring is the. most important thing. Yet when you look. at how what entrepreneurs are spending. their time on, it's usually like the. product, the marketing, etc. And it's. maybe like one or two hours in some. cases if they're lucky on finding truly. exceptional people. They often just. outsource it to someone else, the. recruitment team. When you think back through your career, how important was it to find truly.

exceptional people? Of course. Well, I. systematized it. First of all, um I think. that anything I do or one does can be. systematized. So, I would think what are. the personalities, what are the. backgrounds of the people that I'm. hiring, what are the choices, how do I. specify it? And I've and I got it by. also maintaining a lot of data with. people. There's um there's a TED Talk I.

did that uh explains how like data. everybody's going around and they're. operating in a certain way. So, I know. what people are like. If you know what. people are like, you know what you can. expect of them. And then I would then. say uh in a very data way, those people. who are successful in these jobs have. the following attributes. that would create a job spec, specifications for that type of job. So,

I I knew that in that type of job, there. would be that type of person I'm looking. for. Mhm. Okay, yeah. What works? They. work. Okay, data. And then I would find. that would be my job spec. And and so we. had the systems and then we had some. people who were responsible for doing. that because you're right, it takes. time. How can I interview all those. people and so on. But who can you trust? And you're operating that way and then.

evaluation process doesn't stop when you. hire them. Okay, the evaluation process continues. from that moment and you still learn. more about what they're like and you do. that same process and still think would. I still have hired them? And and if I wouldn't have hired them. in the first place, then they shouldn't. be there. And so I have a process and. people, people and process. Do people. change after a certain point? So, if you. find someone in 6 months, in 12 months.

and they haven't changed, is it worth. giving them another year? Is it worth a. performance review? I found out that. for me, the big question mostly, there. were two big questions, but um. the big question is how do you adapt to. my culture? And that would take about 18 months to. find out. Like, can you speak honestly. about what can we have thoughtful. disagreement? Do you like this. evolutionary process where you're.

challenged and all of this kind of. thing? That culture. That'd take about. 18 months. And then roughly speaking, then. learning about the people, their strengths and weaknesses, would take 18 months to 2 years, maybe. something along those lines. And so then, you know, you could pretty. much decide. But always being open every. day by day so nobody's surprised that. you're always talking about things, you.

know, how's it going? Make sure you keep what I'm about to say. to yourself. I'm inviting 10,000 of you. to come even deeper into the Diary of a. CEO. Welcome to my inner circle. This is. a brand new private community that I'm. launching to the world. We have so many. incredible things that happen that you. are never shown. We have the briefs that. are on my iPad when I'm recording the. conversation. We have clips we've never. released. We have behind the scenes. conversations with the guest and also. the episodes that we've never ever. released and so much more. In the.

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jobs. We use their talent more on. complex long-term projects, ones that. require an expert to take charge and you. can tap into tomorrow's talent at. fiverr.com/diary. And for 10% off your. first order, use code diary. AI is a bit of an alien that seems to. have entered the room um. and has is going to change Every every. every industry. Great. Yeah. I can't tell if you're being. sarcastic. No. Truly. If you are.

working with it, controlling it, if it's. a good partner, to be able to get a lot. of leverage, it's. truly fantastic. As I said, in almost. everything I did, we had the crit criteria, we had the. systematized, would you do that, would. you not do that, how to you know, how. does reality work, what are the. principles. And And so, it's a fantastic. leveraging. Like I described, you know, I would make the decision-making model, like the computer chess game that would.

make it. Well, now it's better than. ever, those those resources. So, it. leverages you enormously. What about. having a strong middle? We talked about. having a strong sort of economic. political middle. Political middle, yeah. Yeah. Is it going to drive inequality? >> Yes, it's going to That's like all good. like all things, it's going to be. it has good things and bad things, and. we were talking, let's say, first about. managing and doing that. I think in. managing and knowing what people are.

like and how they're all it's going to. be very very valuable, mostly very. valuable. In terms of changing. there will be. a limited number of winners and a bunch. of losers, and I think it's going to. create much greater polarity, which as. we're seeing. um. through the system the ways that we. talked about, you know, that top 1 to. 10% benefiting a lot and then.

so that will be a a dividing. a force, I think. It's going to going to. pose the question with robotics. accelerating at the speed of of light. with Optimus and Tesla and all the. things they're doing and all these other. companies, humanoid robots, and then. with artificial intelligence. having trillions of dollars plowed into. it and accelerating. We're in this crazy. boom at the moment. With these two things combining, you're. going to be able to have a humanoid. robot who that can navigate human. spaces, but is also smarter than I am.

Lawyers, accountants, uh. lots of people in the medical. profession. Why would you Why would one. need them. if we had a humanoid robot that is. smarter than all of us and has a PhD in. everything? Well, we will not need a lot. of those jobs for the reasons that. you're saying. Okay. And then the question is what our. society does. And what do you think we do in such a. world? I think we fight over about what we do,

unfortunately. Um. but as I say, I don't think we have escaped a world. where. most people. to have a healthy society, most people. have to be productive. and prosperous. I don't I I think people. need to be Now, certainly. there and there certainly needs to be a. redistribution. policy. I don't think that's just a.

redistribution of money policy. because uselessness and money may not be. a great combination. So, I think that you have that has to be. figured out, and the question is whether. we're too fragmented. to figure that out and agree on it, and. I'm worried about that. Interesting times. Is there any. historical precedents for this in your. view? Someone that knows history. Is. there any historical precedents for. something like AI and robotics.

converging? >> Well, um. through. um evolution, we have gone from. a period of time which was called the. Dark Ages or the Agricultural Age. in which basically. there was land, it's agricultural and so. on, and people were treated and they. were essentially like oxen, most people.

And then there were the landowners who. were nobles, and then there were the. royalty who were the families that. control most things and so on. And then. in history, with the. invention of the printing press, there. became more knowledge. um and more intelligence, and we see an evolution in which. you start to see new ages emerge and. thinking emerge and power change. And I.

won't take you through the whole. history, but you start to see that. individuals can be clever enough to earn. money that So, you begin the Age of. Exploration and the Industrial. Revolutions in which machines replaced. people. And it's almost like they first replaced. them physically, that. In other words, they didn't have they. were not like oxen doing the thing, so. you get a tractor or something, and it.

don't and it's almost like from the body. up in terms of the mind. And so, you've. seen that evolution through time and the. rise of intelligence in its various. forms go through this arc. of rising in intelligence, and now you. see that intelligence matters more than. anything, okay? It matters more than. money, it matters more than anything. because intelligence will attract people.

among those with money to invest in the. the development of that. And so, we have. seen this arc through history develop in. that way, right? And we've seen people. replaced. Now, the question is, as we. get higher and higher in thinking, okay, whether we've run out of capacity to. shift or whether we're just going to be. totally replaced. Our muscles have been. totally replaced, but okay, as this is. happening, our best thinking may be.

totally replaced, and we're going to. have to deal with that question. Are you hopeful? I'm excited. I'm. I think it all comes down to human. nature. Okay. I'm excited in that. fast forward, make the most of it, jump on it, woo, you know, I'm excited.

I've also watched. the evolution of species. Almost all species have come and gone. for certain reasons. And they one of the. reasons. that they come have come and gone is. because almost their strengths are not. in all respects great strengths. You can. use these things, intelligence, to your. detriment. And I believe that um the things that.

these technologies and so on bring us, while very important, extends life. expectancy and all of that, is not important as important as human. nature. And so, if you were to go back in time. and were different societies, do you. have happier societies? Is the. well-being greater? Okay. So, you can go 50 years ago, and. you might say the well-being is greater. 50 years ago, not in all ways, not in.

in many ways the technologies and and. the consequences of those are much. better, but you may have had a better. life, and it's human nature of how. people are going to deal with each. other. So, I think the real question is. can people rise above. this? And and which it goes back to the. spirituality question, can people then. rise above it so that they think of the. collective good, and they think of, you.

know, collectively, how do we make the. best, and also karma, you know, in other. words, the realization that if I help you in. ways that can be so simple for me to. help you and make such a big difference. in your life, and you do the same, and. we have win-win relationships, it'll be. good, but if we don't do that, and I. worry about human nature, and I worry. about this process. Especially when. you've got geopolitical. tensions and It's because of human.

nature. I've had a lot of conversations on the. podcast about AI, and I just can't seem. to get to my own solid conclusion about. this, because when I look at human. nature, as you say, I see greed, I see. power hunger, status. Yeah, some. problems you just just accept the fact. that you may not be able to be confident. of the meta prediction in the future, so. it'll always be a question, and just get. on with the fact of using it for. yourself in the best way that works for. you. That's what I'm doing. We have a closing tradition on this. podcast where the last guest leaves a.

question for the next, not knowing who. they're leaving it for. You know this person. Um. because I've seen you with them. Um the. question they left for you is what is a. book or books. that you've recommended or gifted more. than others, and why? Can't say your own, but I won't. Uh. right. Um. There are three books. There's a book on evolution but written. by Richard Dawkins. Uh River from.

Eden, I think it's called. Then a book by. um. Will and Ariel Durant, which are the. maybe the greatest historians. in time, and it's called Lessons from History. It's a very short book. I think it's 104. pages. They wrote massive amounts about. 5,000 years of history and so on and. they sort of condensed their lessons, lessons from history. And then.

um. Joseph Campbell's The Hero's Journey. Is it the the hero with a thousand. faces? >> Yes, that's it. Hero with a thousand. faces. And why Dawkins book? Why did you. say that one? >> Oh, he understands evolution. Everything is evolving. Okay, all species. Man is one of 10,000. species. I mean and they're and they're all. structured similarly. There's a. structure. They you know, like um two.

eyes, uh a brain that has a structure to. it um that and the same parts of the. brain. There's the cerebrum, the. cerebellum, the prefrontal cortex. There's this structure that makes you. think differently and and so on. There's. evolution. There's all evolution. So, it's not just limited to. um human evolution or what humans are. like. It's the force of evolution. Man. is only. um. mankind's only about 200,000 years old.

That's in history, that's short, okay? And and the species and all species. evolve, okay? And it's very interesting. So, that's you know, that's what his. books are about and you know, I think. they're very good. And Joseph Campbell's. The Hero's Journey, the hero with a. thousand faces. >> it's about human nature and and the. evolution of life and the life journey. that we're talking about. What I find so. interesting, Ray, is how you draw on. principles from other domains, whether. it's from nature or biology as you were.

talking about there. to tie in to your work in business and. investing and everything else and life. and happiness. And it really says. something to me about. being more eclectic and be broadly. curious in order to be successful in my. modern Well, I I yeah, I just. see I I don't is that to me maybe too. much of a specialist that kind of. mentality, but the world is being. interrelated to these things. If you. want to understand how reality works,

um you can't say I'm going to be just a. specialist. I mean these are all affected by each. other. Mhm. Thank you so much for write for writing. these books. They are iconic. And uh the YouTube that. explain these these books are iconic. I. don't know who you have on your team. that makes the animations and pulls it. all together, but not only is the. content. so important because they are. principles, so they're enduring through. time, but they're so unbelievably. accessible to all people of all ages.

And if if you if people haven't read. this book, I'd be shocked, but um all of. these books are fantastic. The this book. Principles by Ray Dalio, which I'm going. to link all of them below for anyone. that wants to read them. I suggest you. read them all. Um will be formative in your life even. if you're not interested in business or. investing because as as it says in the. book, they're principles and the. the economy affects us all in ways that. we might not understand. We're all. trying to be successful or happy in our. own right and that that's interwoven. into all of these books. So, thank you. I hope you write more books. >> Well, I and thank you because yeah, I'm.

at a stage in my life. This is a. symbiotic relationship, otherwise we. wouldn't be here. Okay? And my um. my benefit is that I want to pass along. these things and we're doing it together. and I have found and it's joyous to me. to know that these things have made a. big difference in people's lives. People. come up to me and they say thank you for. the difference you've made and you know, at this stage in my life, that's what I. want to do. I think that's an. understatement. I think it's had a. profound impact. In fact, every person I. know, all of my best friends have taken.

something from your work, which has had. a profound impact on their. decision-making, which has led them to. be happier in some way. And when I told. my friends that I was interviewing you, I'm interviewing 16 people while I'm in. New York over the over the next month. When I told my friends, my best friends. in the world that I'm interviewing you, all of them were telling me to pass on a. message of thanks because there's. something in one of these books that's. helped them and they're all young people. in that first season of their life and. there's there's something in all of. these books that's um pushed them closer. to their success and their happiness. So, thank you for on behalf of me cuz. you've had a profound impact on me, but.

thank. >> Thank you for giving me that joy. I know I mean you know that. Thank you. I really really mean that. Thank you so. much, Ray.