Thread by @NeckarValue

Ray Dalio in 2000, on the history of predicting the future:
"most people who experienced consistent reinforcement for 10 years were inclined to believe that this would continue indefinitely"

academia.edu/33406891/Bridg…

"At the end of the 60’s I remember most believed that managing an economy is like managing most things, we get better at it with time; it is why we could expect even lower volatility in the future.

This view was held just prior to the one of the most volatile decades ever."

"I feel my understanding of the world economy is reasonably intimate going back to the 1920’s, meaning that I believe that I have both an intellectual and visceral sense of what they were like."

"I have learned that dramatic change is the norm and to doubt the new era theories."

"As the fifties began, American psychology could be described as cautiously confident -- cautious because that was the instinct created by twenty years of depression and war, and confident because the United States was indisputably the most powerful nation on earth."

"In the sixties, Americans lost their cautiousness and kept their confidence"

"Americans believed that the economy could be turned into a sort of perpetual wealth machine."

"Going into the long bear market overinvested because of their tendency to extrapolate the past."

"Early in the 1970’s, Americans had never experienced inflation so they weren’t wary of it.

By the end of the decade, they were traumatized by it and assumed that it would never go away."

"Thirty years of prosperity and peace created a faith that our problems will be resolved."

"The eighties were almost exactly opposite the 1970’s as inflation hedge assets fell while financial assets rose, and the trade-off between growth and inflation that no one doubted, ceased to exist."

"to me the 1990s have been most like the 1920s"

"Stocks were great investments with broad ownership at the end of both decades.

There was unbounded optimism concerning the future and how easy it is to get rich by speculating in the market or working for new technology firms."

Nifty chart of Russian credit spreads around its debt default.

"Putin is a political unknown. He is 47 and truthfully has more experience as a technocrat than a politician."