Ray Dalio shares his views on the three important things going on now.
Most people should get themselves in a position where they are net positive, he said.
“If you earn 100 dollars and spend 105 dollars, that is misery. If you spend 95 dollars instead, you’ll have a good life,” he said.
Deferred gratification provides savings and the possibility to invest.
The second is to avoid the common investor mistake of believing what did well in the past is a good investment.
“The nieve money buys the thing that was hot,” he said.
Ray Dalio recommends that investors should diversify. “Picking the best investment is difficult, particularly if you are naive,” said Ray Dalio.
“The nieve money buys the thing that was hot”
RAY DALIO
“We spend hundreds of millions of dollars on research to try and get an edge, now you have got to compete with us,” he said.
“Competing in the markets is more difficult than competing in the Olympics,” he added.
“Diversification will reduce your risk without reducing your return. Knowing how to diversify well is critical,” said Ray Dalio.
Ray Dalio shares his views on getting ahead
Summing up, Ray Dalio said to get your savings right, have great humility about what you don’t know. Don’t buy the thing that was hot. Knowing how to diversify well is critical, he said.
Ray Dalio shares his views on events going on currently
“The three important things going on right now, which didn’t exist since the 1930 to 45 period; The first, is what is going on with money and credit and zero interest rate,” he said. Ray Dalio noted that the government needs to step in and buy.
“Competing in the markets is more difficult than competing in the Olympics”
RAY DALIO
“So, what we have is the production of a lot of debt. The central bank prints money buys that debt to spend,” he said. “We are coming to the end of the debt cycle,” he added.
“They’ll print money, and that will devalue money,” said Ray Dalio.
“Second one is wealth, and political gaps are causing great conflicts. Throughout history people have fought over wealth and political power,” he said.
“China’s income has increased by 30 times since I visited China and is growing faster” – Ray Dalio
Ray Dalio noted that when you have a large wealth gap, an economic downturn, and a large debt you have a fight with the political left, right, capitalists and socialists.
So Ray Dalio shares his views believing that discord is coming when the US doesn’t have much money. “We are printing and putting it out,” said.
Ray Dalio noted that if checks did not go out during the pandemic lockdowns, there would have been a revolution.
But he also noted that the printing of money is diminishing the currency value
Ray Dalio shares his views on the changing world order, particularly the rise of China
He noted that post WW2, the winners carved up the world with half the world economy, and 80% of gold being in the US. The IMF and World Bank were in Washington DC, UN in NY. “Rule was set in the US, it was the American century,” he said.
The rise of China is now a comparable power. “China’s income has increased by 30 times since I visited China and is growing faster,” he said.
Ray Dalio also warned that the Wealth divide in the US needs to be addressed before the red line is crossed. “Both sides need to understand that this will lead to devastation, if they don’t deal with it together,” he said.
