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Ray Dalio

@RayDalio

Jan 20

While historians assign dates to the beginnings and ends of civil wars, they are arbitrary. The truth is that almost no one at the time knows that a civil war has begun or that it has ended, but they know when they are in them. (1/5)

For example, many historians have designated July 14, 1789, as the day the French Revolution began because a mob stormed an armory and prison called the Bastille. (2/5)

But nobody at the time thought it was the beginning of the French Revolution or had any idea how terribly brutal that civil war and revolution would become. (3/5)

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Ray Dalio

@RayDalio

Jan 13

Interest rates are shown in these charts that go back to 1900. They show real (i.e., inflation-adjusted) bond yields, nominal (i.e., not inflation-adjusted) bond yields, and nominal and real cash rates for the US, Europe, and Japan at the time of my writing. (1/4)

As you can see they were much higher and now they are very low. Real yields of reserve currency sovereign bonds, at the time of my writing this, are near the lowest ever, and nominal bond yields are around 0 percent, also near the lowest ever. (2/4)

As shown real yields of cash are even lower, though not as negative as they were in the 1930–45 and 1915–20 great monetization periods. Nominal cash yields are near the lowest ever. (3/4)

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Ray Dalio

@RayDalio

Jan 6

I hope you will take this one year anniversary of the January 6th events to reflect on what caused them and where we seem to be headed. The events didn’t come out of the blue. (1/5)

They were clearly emerging from years before as an extension of a pattern that has happened many times in history due to causes that are essentially the same as those that caused January 6th. (2/5)

By connecting the dots back through time, we can see the causes and effects and imagine where we could be headed. We can see that the order we have assumed would never change could change in profoundly disruptive ways. (3/5)

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Ray Dalio

@RayDalio

Jan 5

If the amount of money being lent to finance the debt is inadequate, it is perfectly fine for the central bank to print the money and be the lender of last resort as long as the money is invested to have a return that is large enough to service the debt. (1/4)

History shows and logic dictates that investing well in education at all levels (including job training), infrastructure, and research that yields productive discoveries works very well. (2/4)

In fact, improvements in education and infrastructure, even those financed by debt, were essential ingredients behind the rises of virtually all empires, and declines in the quality of these investments were almost always ingredients behind empires’ declines. (3/4)

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Ray Dalio

@RayDalio

Jan 2

This evolutionary cycle is not just for people but for countries, companies, economies—for everything. And it is naturally self-correcting as a whole, though not necessarily for its parts. (1/4)

For example, if there is too much supply and waste in a market, prices will go down, companies will go out of business, and capacity will be reduced until the supply falls in line with the demand, at which time the cycle will start to move in the opposite direction. (2/4)

Similarly, if an economy turns bad enough, those responsible for running it will make the political and policy changes that are needed—or they will not survive, making room for their replacements to come along. (3/4)

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Ray Dalio

@RayDalio

Dec 30, 2021

Write down what your one big thing is (such as identifying problems, designing solutions, pushing through to results) and why it exists (your emotions trip you up, you can’t visualize adequate possibilities). (1/4)

While you and most people probably have more than one major impediment, if you can remove or get around that one really big one, you will hugely improve your life. If you work on it, you will almost certainly be able to deal successfully with your one big thing. (2/4)

You can either fix it or you can get the help of others to deal with it well. There are two paths to success: 1) to have what you need yourself or 2) to get it from others. The second path requires you to have humility. (3/4)

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