Ray Dalio was broken early in his career, and he had to borrow $ 4,000 from his father – and learned a major lesson that they put on the billionaire road

“This was painful,” Dalio told a billionaire colleague, Carlal Group Participant founder David Robinstein, in A. Conversation on 92 Street in New York In July. But it also had a deep effect, and continued.

“He changed my approach to everything,” Dalio said, adding that he learned a major lesson from this episode.

After he went out on his own to find Bridgeter in 1975, Dalio said that he had reached the lowest point in the period from 1980 to 1981, when he, according to the United States, had lended more money than he could pay and predicted a major debt crisis. When Mexico failed its debts in 1982, Dalio believed that his position would bear fruit, even in the face of the severe economic crisis he expected. However, “it couldn’t have been more wrong.” Instead of shrinking, the stock market rose, and monetary policy has been reduced, which cost it dearly. This badness left his financially destructive appreciation, forcing him to borrow $ 4,000 from his father to meet the family expenses.

“Nobody does everything perfectly, not even Warren Buffett,” Dalio told Robinstein, but this episode gave him “humility” to keep up with “boldness”, along with a very simple lesson in “the power of diversification”.

Dalio lessons

He said that this humble episode changed the Dalio perspective, which led to transformative visions:

• Lesson 1: Cultivation of humility and skepticism in certainty. The experience that made Dalio deeply made how to know if it is right. This new approach led him to a practice that he started nearly 35 to 40 years ago: stop thinking about the specified criteria that he will use to make a decision. This work was forced from documents to think deeper, and later realized that these criteria can be coded and tested back to assess their effectiveness over time. This systematic approach to decision -making, which it calls “principles” (after thousands of them wrote), has become the basis for which Bridgewateer Associas was built. It is also a title The best -selling books in the New York Times.

• Lesson 2: Embraceing the power of diversification. The crisis also led to Dalio estimation to the diversification estimate can reduce risk by up to 80 % without reducing revenues. He said that this revelation has become “Bridge Water bottom”, from this point, the company witnessed consistent positive returns, with an average of about 11.8 % over a period of 30 years, with the minimum annual decline. Its investment talisman has become “15 unrelated return streams”, designed to design similar expected returns, which he found greatly reduces risk and enhances the rate of return to risk with a five -factor.

For Dalio, this period was not near Ruieros, it was not a setback, but rather a deep educational experience that redefined his investment strategy and his personal philosophy. Now that he is in “a stage in life in which things are going through,” Dalio said he finds “great joy” in sharing these learned mechanics and reason’s relationships with others. His goal is to intimidate people, but to provide understanding, and operate on the principle that “if you are worried, do not worry, and if you do not worry, then you need anxiety”, because anxiety can prevent one fears. Ultimately, the Personal financial rock bottom has become the basis for its constant success and commitment to teaching others how to move in complex financial landscape.

Dalio’s new book on how to break the two countries

The go was to break in Dalio’s mind because of the topic of his new book: How countries collapse: the large session. Dalio, who often issues social media warnings about America Country debts of $ 37 trillionWritten on LinkedIn He wanted to write this book because he sees the United States and other countries “heading towards obtaining its equivalent Economic heart attacksHe said he wanted to explain the mechanics and the principles he used, since he learned these main lessons in the early eighties.

The credit/market system in the human circulatory system is similar to “bringing nutrients to all parts of the body that make up markets and economics.” If this does not result in enough income to serve debt and benefits, “debt service will be based like plaque that presses the other spending.”

In a statement submitted to luckDalio said that one of his principles is related to recognition of large courses and patterns.

“The same basic big courses that drive these systems have occurred to change thousands of times before for the same reasons,” and it describes the “comprehensive large debt cycle” in this book because he believes that the world “is on the verge of very big changes.”

It is a product for years of boldness, spraying a large dose of constant humility and diversification.

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