"Power comes to those that can recognize patterns" Tony Robbins
We are living in historic times. It's no wonder that as disruptions to life as we know it occur on a global scale, people are experiencing high levels of stress and anxiety. While you may want to turn off the news and cover your eyes, the truth is: there’s power in being able to recognize the underlying patterns and anticipate what's coming so that we can prepare and respond.
Ray Dalio is the founder and co-Chairman of Bridgewater Associates, as well as a #1 NY Times bestselling author.
Ray conducts his business and lives his life based on key PRINCIPLES. His latest book, Principles for Dealing with The Changing World Order points out why nations rise and fall and shares information you need to recognize the times we are living through are part of a larger cycle that has taken place many times before.
In this 2022 interview with his friend Tony Robbins, Ray shares what we can do on a personal level and on the collective to navigate these unique times.
To watch the interview, go here: https://youtu.be/q3hdisdjBjQ
[1:39] Tony on the Power Patterns [8:51] The Cycle Explained: What's a New World Order? [16:00] What's a populist? [18:50] The 8 Measures of Power [23:52] The 3 Big Events that lead to a Changing World Order [28:40] Why did Donald Trump get elected in 2016? [31:02] The 5 Types of War [35:20] Ray's methodology of studying history [40:17] The collective experience is all about how we are with each other [41:29] Education, and disparity in the state of Connecticut [46:49] They call them revolutions but they're civil wars [54:03] Ukraine, Russia, and China [1:03:02] Inflation: What got us here and what do we do now? [1:10:00] Taking away buying power to fight inflation = period of stagflation [1:14:47] The Holy Grail of Investing = diversified uncorrelated assets [1:18:28] More on China [1:24:25] Ray's 3 Tips: How You Can Avoid the Decline [1:28:47] "Whatever success I've had has come more from MEDITATION than any other influence."- Ray Dalio [1:33:44] At 72, what's next for Ray Dalio
This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
The welcome back to the turnaround podcast today have a unique privilege and pleasure that is to bring you a conversation with a personal hero to me, as well as millions of people around the world
as a man, who's very humbly started as a golf caddy. If you can imagine and became the most successful hedge fund manager in history, returning investors more than fifty billion dollars in returns,
It is also unbelievable entrepreneur and so many of your other entrepreneurs, one the most successful companies in history, started Bridgewater in a two bedroom apartment
twenty six and he's grown into an organization to manage almost two hundred and thirty five billion dollars in business
he's. Also an student of history,
particular history is not part of the stage of his life
vantage point of looking at things differently than most people, so are you familiar with first book very kind?
whether it was the first was the first major book
Be sure that what most of you join our important it is
Today we are talking about, is new book, it's principles for dealing with the changing or is actually
the understanding of how culture,
and how they succeed and fail and where we are today. This is the book I want to make sure you won't pick it up for sure
I really just wanted to thank you for school for joining against great, to see you it's so good
to see you two done. You look great near and also had a glimpse and after family, and so that that brings me a lot of joy, so good to be here, anki for the fisher
This book is extraordinary six hundred pages. You got you five hundred years of yours
we too are regulated patterns.
before we start, if I may take a minute just to set this up for everybody, because most people who follow me know that my belief is that
those that can do three things. One recognise patterns
the music and entertainment business was, I angels unusual.
Did you recognize patterns, uv. Take things. Look my ass, a turn into something that you can forget and begin to pass anticipate.
One part life and businesses apparent power, anticipate
years, anticipate the
It does tend to react as though we were
This conversation, we can give you a broader picture where the world where america is and more important.
why we are here because of yours, near
is the driving force that make something happen. You're are able.
the spanish, but also do the second start to utilise those that I need to protect.
Ro or to spare?
and the greatest masters in certain areas actually got a thirty year, which is the only create that new ways to make things happen to turn things around. To make a change
Ray you lose your entire life and patterns reoccur over and over the ethical cycles.
If you're, a student of cycles in one of the things you've done is built principles, these tools that help you recognize these patterns and showing how to really maximize where you
Would you start out near the thirty thousand foot level, even before the and tell us all about
your journey from the beginning days is a guy to beginning a recognised power
and some of the places that you missed along the way and why mrs were so valuable. I know you know you with
yeah because the early eighties were after building your company, you were so successful and it looks like
I lost almost everything you have to start over, so I think it'd be really important that you understand
we talk about the world in the country
standing of these patterns and how they can give you the ability to create a greater quality of life for yourself or your family. Your company, sir, when I was a kid as you point out, I I caddied I delivered newspapers, I did a bunch of jobs when I was a kid at age. Twelve. I bought my first stock. I was caddying. The stock market was hot at the time and people I caddied for were talking about it,
the first doc I bought was stopped by the name of northeast airlines. The only criteria I had was that it was selling for less than five dollars a year I figured I could buy.
More shares and of went up. I go up nor money that was done, but the company was about to day go bankrupt. Another company acquired it a tripled in value and
I have on the market so as I've done the markets on at the beginning of twelve and that's my game. Okay, now fast forward. Ah, that's twelve at twenty two ten years later, so
nineteen seventy one. I was following the markets and between graduating from college and going to graduate school. I was clerking on the floor of the new york stock exchange and
In that intervening period there was a lot of aspirations. A lot of
I desire, and you know to go to the moon to eliminate poverty to make
equality in the united states and so on? So in that
early era. When there was Kennedy in- and that made me an optimism and then but it dry
that ten years. The fact is that there was a lot of borrowing of money, a lot of deficit back then a gold
money and our money. As we know it was like checks in the cheque book that would go, get you the gold. You can turn in your paper money for gold, but gold was the real
money and because the united states had borrowed a lot more money than it had, it wrote a lot more checks than it had gold in the bank and so on.
August, fifteenth nineteen, seventy one. When I was working on the floor of the new york stock exchange, I watched on television as president Nixon defaulted on the obligation to pay
but the cash he went on, and he said you know if they want, you won't get the gold. I of course he did
say it that way. He said it in a way were it sounded like they were speculators and so on, and he had to do it. But the goal:
and so on the floor of the new york stock exchange and walked on the floor of the new york stock exchange, and I thought the market was going to go down a lot because, after all, this is a big crisis.
As we know it ends, and I couldn't have been more wrong. It went up a lot and what happened? Was I never
and through a currency devaluation before, because in my lifetime there was no currency devaluation, such the first time it happened. So I went back and I looked in history and I found the exact same thing happened on march fifth, nineteen, thirty three
except rather than the television and next said it was the radio and roosevelt than he made the exact same announcement at the exact same effect, and at that time I learned to things too big thanks
I learned that first, that many things that
we're happened in my lifetime seem surprising at the time and then
needed to study things that happen before my lifetime to understand so uncertain
Things are happening like right now there are certain things that have never
happened in our lifetime before but happen
many times in history,
so in order to understand them, just as you said in the beginning, I need to understand the patterns and even more than the patterns the cause and effect relationships behind the patterns, so that mistake taught me that I'm not none not needed to understand history, and there was
and each of the mistakes has taught me. I've made a big mistake and nineteen eighty two. I won't take you through it because just by take too long, but in other words a big mistaken and eighty two one. I am calculated that foreign banks for american banks a lot more to foreign countries than those countries were baby pay back. There was a big debt crisis. I'm anticipated this debt crisis. Mexico defaulting right, ok, bought what happened is the economy
and I expect that there would be a terrible economic situation and you know what happened. The federal reserve printed a lot of money and would, at the same time, these euro you'll learn lessons. Ok, that set those lessons that I learn. Let me studied the nineteen twenty nine to thirty two period, which allowed me to anticipate the two thousand and eight financial
crisis on and make a lot of money. There were most people lost money and right now, it's what's happening now as let let bridgewater and us
a lot of money while the markets are behaving badly now, because the same thing happened in the past. So yes,
studying history. Learning the lessons writing them down. Modeling them, there's a template of what is happening there.
his story. Would you mind taking us through the big cycle of the rise and decline of an empire and what that sounds like a big thing, ladies and gentlemen, but think of it.
Human beings have stages of drought and writers, persists,
you become an invalid gonna die you going. Quality stage, has certain policies, opportunities, strengths and weaknesses?
Josephine drive your car they're, going on or miles an hour over governance,
you might get to a stage where european, to when your pride, when people started agent
Would you rejuvenate themselves that the age can increase decline until their death
How would you go to disciples, but also countries and more importantly, empires or maybe
before you can give us the big, wise involved,
maybe description of
do you mean by a world war,
I'm gonna love, I'm gonna do that very quickly in a nutshell, and I also want to say that you don't have to read the book
I did a of animated video, which is on you to call the changing world water.
It's an animated, entertaining video. That's about forty minutes. Long and it'll tell you the whole thing better than I can squeeze in now
But let me tell you: ok: what's in the water, ok.
am and water is the system, that's operating. How do you operate so, for example,
there is a domestic water. We have a constitution and demand
mercy and that's a system that operates in that continues on until there is a war and then there's another system that comes it replaces our system has lasted
long time, there's also a world daughter, in other words, a world system and that world system of operating comes after
wore white is war happen because conflicting parties of about equal bower have a fight and the dominant?
our winds and then they get to set the rules and the last
time, that happened was a nineteen forty five because of the end of world war, two, so he and at the end of world war, two, the united states at eighty percent of the world's money gold was money. Then it had
half the world's economy. It had a dominant military power, and for that reason, because it was a dominant power, they in the new EU new york is where the united nations is
The washington d c is where the I m f and world bank. They put it there, because that was the american world order. The dollar was the world's reserve currency, and that always happens you. If ever there was a trip before that and at the end,
well, one that was the treaty oversight and the winners in the treaty.
The reside determine how the system was gonna work after that, and if you go back in history repeatedly, there
always a world order. There was always happens this way and it continues okay. So how does it work? You end up with that world water and then you come through a period of peace and prosperity because nobody wants to fight the dominant world power so that peace and then, in that period of time wars are sort of great equalizer, may reduce wealth, differences, wealth gaps and so on
and then there's a rebuilding prospect process and that produces prosperity and peace. Also, nobody wants to go back into the war.
Everybody remembers how horrible they are before that.
at you know. The cycles typically can take one hundred years. Let's say they can take a lifetime and arm, and then people forget, because they weren't the same people. They forget how terrible
wars are after wars, people remember how terrible wars aren't they want peace. All of those reasons produces peace and prosperity and there's also a financial reorganization, but then that peace and prosperity leads naturally to arm of the country that has that having the world's reserve currency, a reserve currency means it's the currency that is accepted. So naturally, the dollar, as the world's reserve currency of
that it was the british bound you're the bridge, and by before that it was the dutch guilder, it's the same pattern and so on, and there is peace and prosperity with the world's reserve currency. Now, when you have the world's reserve currency, the rest of them,
once the save and they save in that currency, and that leads the country you as the world's reserve currency, to borrow it gives them, what's called the exorbitant privilege of being able to borrow in print the world's currency by that's a good thing that and then what they do, of course is ass. Prosperity continues and acid prices go up, like stocks go up and everything does really well,
and it encourages more borrowing and spending and betting on prosperity, and that begins to have a rise in levels of indebtedness. So you see that levels rise, and the third thing it does is: it creates a greater wealth and values, gaps that become greater naturally and it where the wealth is
well, that is distributed unevenly and those who make a lot of money then begin to have a larger wealth gap and and that's and that creates also an opportunity gap. And if we're lucky enough to have the money, we can educate our
children well and so on, that gives them in their unfair advantage, as in relationship to others and sell this wealth gap, the increases at the same time as levels of indebtedness, increase and then, of course, what happens is the competition increases the competition increases.
Because at when you win- and you have the other, germany or japan or other countries destroyed after the war- and there are no other competitors, then it's a dominant position, but over with time others learn and begin to build up like china, particularly on has increased on its per capita income and it's competitiveness. And so China is a competitor with the united states, but all
through that time it was like the british were competitors with the dutch and and Cela. So we see that pattern happen over and over as that power gap narrows and then conflicts about how things should go,
in praise and internally, there is a conflict over wealth and wealth gaps and then
it's a higher level of indebtedness which makes for a worse set of circumstances and that combination of circumstances and leads to more conflict and more problems. So traditionally you see that a few of the a lot of levels of debt are on the classic way that you see this is what does the government do and doesn't have enough money? It's not like. They go into the coffers. The coffers are empty
there have no, but they have not that money. So where do you get the money? They have to take the money from somebody else, that's either through taxes or what they do more.
people, get angry when they're taking it away and there's a big fight over some.
They usually do as they print money, because and through the rotten times back in roman times they had gold coins. They put less gold in the coins, had put other battles in the coins and
Evidently they print money when they want to spend more, and that, of course, produces the inflation, devalues the value of money and went, and you
who's buying power. And when that happens, what the same time there's there's a large wealth gap and an opportunity gap that produces a lot of internal conflict of the sort that we're seeing now you always see populace of the left and populist similar the right. What's a populist, a populist as a person who will fight for their side, they are not compromised. Okay, so that you see that there's you get to the point where there may not be compromised. For example, january sixth is right out of the populist playbook, in other words, fighting for bauer. It's a it on you, it's entirely possible that we will see that neither side in the upcoming elections would accept, lose it okay and there's a conflict. So you have the that populace and that greater extreme of the left and the right at more internal conflict. And then, as you, have the rising power challenging the existing power, you have the of the world conflict and then normally that produces an alright.
Illusion which happens to wars, because there's no world court that you bring your case do and then there's a adjure journey. Dirt jury makes a decision you it's true, typically through conflict, you have the next war and you do the same thing over and over again, so that by and large as the pattern
where have you been with simulators is rising hour after the war? There is this new birth of a new power. There was some strong leadership, as I noticed you know about. You talked about
are you to continue because the life cycle of a cat,
do you remember any way:
I remember, I think you said the average like two hundred fifty years, but that's like saying the average lifespan in america. Seventy two people died
These are people make a gun and twenty the oldest humans on the planet. So
but he has university a little bit where we are with more that causes you're talking about those early days. You talk about these eight back
have you going a measure of the house
about the sixty zero per person could be
breaking down you're awake? I want to close,
or they could do something in started around real.
DR himself, and become younger brothers.
the measure whether things
you measure they take us
rise, been burnt out and then declining of an empire.
And will again users are another war, a new world order, restarting over as usual,
Examples are examples of this.
We showed how they rose, greatness
creativity, a great education and innovation, great the better because they bought me. The most incredible ships resent people around the world to either go create wealth or take wealth is, I think, the way you language good and
the back, but eventually they get knocked off because they get richer and richer. People want to work for less and all of a sudden. The british come along and say: let's hire the dutch builders,
and let's do deal with our people, which is cheaper, we're going to build more ships anymore. So this
those who would you describe tractors, allow you to carry out a pause.
to measure? Will we are in a cycle as an empire or as a world power that with such a great summary, would you just gave?
So I'm gonna basically almost tell the same thing a little bit more slowly because but gap
I am an and there's aided, then in the book I image I measured eighteen, so that way you couldn't watch they
objective numbers thereon, measurable, just like in oh, if you ever
blood tests and urine analysis, and all of that other measure you have measures
The reason I wanted I am, I need objectivity to be act.
But also by being able to measure those things.
Could see whether you're improving or not till it's a type of bio feedback, but yes, you're right, you're right. What did it starts with, for example, is good, broad based education. It starts with education. Educated people are are more valuable than at its and and there's two types of education. There's education of like what you know in what skills you develop, but there's also a learning civility learning how to behave with each other. How do you behave with others to make a productive society
Oh related to that, as we think about that think about parenting. Think about the importance really what you want you, what I had with just going back to the basics
What I had was parents who love me a more good guidance. I had a public, I went to a public education and it was public school and it was a good public school and I came out to a world of equal opportunity in which there was an opportunity to make decisions
make things happen and then leave the american dream and really those are the most important fundamental like if you can get good guidance in there in your life and you can have good education and you have a system that provides you good unequal.
Virginity. I mean that's basically, yet capitalism, it gives you the opportunity. People say: that's a good idea. Give you money
the build it out and so and it's important to do that broadly for the population, because you don't know where the talents going to come from. If you look at the the the best innovators, if you look at
anybody who has been successful over up your dot. You know the forbes four hundred or something and you look at those. Many of those people came from the simplest. He never would have guessed where they would come from and so having a broad base population. Not only for,
a higher level of productivity which raises in gap and raise
his power? It also means that the individuals themselves have a fair
Society may believe that societies there, so these are
the mental and when you start to see that, then you have it reflected and other things it reflected in inventions and interventionist. So we met measure
how many innovations technology,
air of world trade. The country has a number of the statistics, and you
I can see. You can see that on an ad when the united states was dominant or the british were that dominant, they have a high percentage of world trade and, as a result of that they have the world's reserve currency. So you see it reflected in the
currency statistics. Another word whose transaction they have the world's financial centre in.
In the dutch empire was amsterdam in the british empire. It was london in the american empire, it was new york and as the world's
angels enter, and so you see it reflected in all of those measures of power,
a military as DR reject your world, our marriage, world trade rules
it rather wharves military as well as another form of exactly. I forgot to mention that, of course, you're travelling around the world. Just as you said, you had the trade rules.
Operating in your occurrence. A you need a military, ok united states, for example, has bases in seventy countries. Now seventy gun
Ok, so you have to be a military power as a result and all of these powers support each other.
As they as you game, one you get them all. So you have to be a total power like the self.
union was never a total power. China is a total power
soviet union, was never a total power because it was never the economic power. Ok at a military that was comparable and no nuclear weapons, but it was because was
for an economic power. So we have that kind of a situation. China now is a comparable economic power. So when we look at
These measures, the united states in some ways, is a little bit ahead in salmon little, but behind but there's no,
ability. So as we go through that rise, we start to talk about. Basically when we become so prosperous because more
two things here. Someone else can do and cheaper copy or create new innovation.
give em advantages. We
our financial systems in the world wants stability. Daisy all save my money in: u s dollars, so they loaded
as we do
more and more until we ve used it so badly that now there's a giant bust and now that bus brings us down to day. I just your dad,
so this is one of three things you started tat come in and the decline of three things are happening today
not happen so much in your lifetime, the over spending
We can touch about those three now to how people really understand just those three principles that are probably most practical for people to notice right now, the three, the three are:
our creations of a lot of dead and the prince
of money by the central bank to pay for it a lot. Ok, that's number one and your seat.
Are you spending more than you earn. Is the bottom line right bots you can't spend more than you earn. That's your you got it
does your things are well just a basic long and economics? You can't keep spending more than you were ok because then what do you do that you created on debt and dad has to be paid back? Oh I'm one man's assets or another man's liability, so you ve got debt somebody's holding, not expecting a real return and when you don't give them a real return like we're not giving them the real return now than they.
Sell the debt and interest rates go up, and then the central bank is in a bind because they have to print more money or they have to curtail it because the day of paying back comes, the only question is whether you pay it back in hard money or or and or deflated money, so think about it. It's like borrowing when you borrow it's like borrowing stuff in we think of that it's a certain number of dollars.
The bar budget was the thinking that your bar and stop, and when you borrow in spanned than you can say
more than you are because you borrow that makes a difference to you spend more than you learn. That means in some point in the future,
to pay back. You have to spend less than you are ample and what that means. Quite a change in your spending is going to change them.
Now? If you are, you become more productive right now,
the difference dream for not to live?
borrowing money, so that
you're, something for my farms are far more.
It'd produce more result as an investment,
I would absolutely rock that absolutely right. I love this partnership in our conversation of describing it cause. You got it so well, and and and that's right so debt is in bad debt. Debt is not bad if
it gets you the resources to produce more than the cost of that debt write at it. So think of it. It says what it if you borrow to have a party evardo to go to vacation. You borrow for
Subject: there's not going to be an income earning asset, okay, so the day will come back and you're going to have to pay that back and that's not good if you borrow to invest in something that is going to produce more than a cost and you're going to produce have that productivity. That was a good move, but you will see it because
If tat rises relative to incomes, then you know you're not doing that
if incomes rise more than the dat. Okay, that's a good thing. So those are fundamentals, and you know and that's how the cycle works. So the three things that we just touched on number one number two is:
the internal conflict thing I'll get when there is a large wealth gap and and values gap it such as well but its values gap. How we should we approach our circumstances, but there's wealth gaps. Then there become the disenfranchised, those who feel on you're, not taking care of me
That was very classic with the two thousand election of donald trump. Why
did donald trump get get elected. Ok, because there was a population in the united states, a significant population. That said, I I hear this system is working for me and I want a fighter I'll get. They don't want to compromise, they want a fighter, and so you get populace of the right and populous of the left, the war fighters and not compromised- and that's that's an issue for us
democracy, because a democracy is based on following the rules and compromising, but these are win at all cost people, and so that begins to build out. That's why January six wasn't a surprising that it was right out of the populace play, but because it is win at all costs and where, in a situation where, in the future, we can see on the pilot party except lose accepting losing and we could see, for example, the not following rules, for example, the supreme court decisions. You could see that states and and towns might say we are not following that decision. Come make me and other. Would you see? Power begin to operate, and so that kind of internal conflict is very normal at those types, those circumstances, burial
understand how that works in the in the nineteen thirties, for democracies chose to become dictatorships, because there were conflicts between the left and the right. What is fascism? What is you know? What is communism that was the same right left
conflict and that, as a result, they produce enough disorder that they ate the literally the parliaments and chose autocratic
leaders and one of those autocratic leaders do they fought internally, but they got control and then there are inclined to fight extorted because these people of fighters- and so that's why it there is a tendency to produce a war. So that's number,
to that internal conflict, this is all measurable, so in other words the un, describing it in words, but in the book or even in the video, you can see the lines in the charts that can show you where you are and the third. So so internally. That is the conflict. A number three is externally the conflict. When you have two great powers coming in and you can measure the types of wort, there are five types of wars. There is a trade war. Is a technology war. There's a jail political influence war, there is a capital and an economic war which is commonly called sanctions. Okay, that's exist and as a military war, and usually they progress in that order until like when you see big sanctions happening, and we will hurt you economically, that is and that sort of a signal that you're at the edge of what could be a military war like in Japan. We did as
If Japan had this expansion, the united states got in the conflict, it froze japanese assets in much the same ways where frozen central bank assets in russia and that kind of a move and arm and that limited of their oil imports and, and so that put them in the
water and then that lead to poorer harbour, sell these types of patterns. Repeat, as you say in that same way, so
with regard with an armistice with germany was punished severely.
they had a very similar reaction back to the corner and that's where hitler got his birth right exactly so. The three are a lot of debt and money creation, the large bomb internal fighting over the between the left and the right populace, usually over wealth and values and external conflict. Over many things, trade technology company
and so on. That could lead up to a war path power when those three things happen to gather that's a lot of pressure, that's a lot of
and so what I saw. Those three things happening together and I remember back you know I have to study history. If I didn't see many cases of it, I need to study so I needed to go back to see many of the cycles. I do to go about five hundred years and I studied jain dynasties in china since the year six hundred to see the
cycles happening and they will happen in the same way. So I know where we are
ro as well, so that the bigger buyers all across the street. You see the exact, a bad enough
Love is over shorter, just like a human life. Their way has been
What is the average in terms of and fifty years it's about a hundred and fifty years give or take about a hundred years
So you were, you want a real good long. One is, is two hundred fifty years
the short one is about fifty years. They're typically, you know, let's say at about one hundred and fifty but it'll it'll it'll it'll vary a lot just like the life cycle, as you
he gave the example of the were targeted as having kind of a checkup from the neck up if you viewer. This is the medical on that person. We know where we are in terms of the length of the life of this particular world power.
all america cycle,
More importantly, as we usually causes and sources of these three other primary once it is not,
I want to clarify which getting this frankly is not
sprinting more major spinning way more than yours, the fundamental they cannot be sustained.
using basically reserve currency- and the speaker
of the wealth gap has expanded.
the difference in what people expect thinks that the idea of you get well you in our work as much? It was not just well be people everyone is wealthier, is comparatively where they were
as on others, competition, its doors to be created, and because there is conflict and your weak financially your way
five each other now extra
on the rise jan began at
I soon usually we resolve, is used in warsaw.
Well the elements that we're on right now and I really appreciate you walking through the different wars and the fact that
I as well ending with a real physical wars, answer's no quarter
I was always there. We can talk about the EU and not only abide by it.
you were basically flat
so tell me this way,
what made you at this stage decide to do this level of studies. Yours, MR history,
just eve use through patterns that what happened to us all- and I, like I- studied history going back to about nineteen
dread and awe and of about that, but that wasn't enough
nineteen. One hundred allowed me to anticipate the two thousand and eight financial crisis and so on, but actually to think about the rises and declines of reserve, currencies and empires, because these cycles take so long. I had to go back five hundred years, which one thinks of as
warm, but it's not because in those cycles, even there there's a limited number of cycles. So, like you say, if a typical life cycles, seventy two years old or whatever the number is along those lines, and you want to study- and you know a few of them- you want to study.
In many cases as you gad, you need do that cut back and see those number of cases, but I would but in that five hundred year period I studied the tap ten top.
empires and they I saw they all had the pier that that that cycle and then I also studied, like you say, roman others, and they and I saw they alone, have it. So it's like a movie that happens over and over. Yet it's it,
just as though are the same story happens over and over again and the only things that change of the clothes, the people where and the technologies they use.
I have a whole life. Looking at human beings, I began to realize early on that it helps so many peoples. There are not unlimited personalities and there are not
well. Others complexity, if not infinite complexity,
a limited number of years,
is that occur. Most often, you can take most people's problems and junk into thirteen different types and then you're going to have a million solutions for them. If you can anticipate the power
you Brian, when a whole people listen to, they may not be excited hearing aren't we will start with the book
joining allows depressing as in no way things
The present know someone bureau is aging too vast or have a disease or cancer of you know. You gotta do something about it and you may not think so.
Controlling the right to live as everything changes. No one wants to yours
the ends, but something begins in our way through the night
There is the day, always after the worst winter, there is a springtime and when you're in the middle of a jury, you, when things are going to people, he is going to go good forever. When
these Google maps forever. You know pandemic last forever, including what we just went through no war,
It lasted forever
If people understand, though, if you don't know, if you stick your head in the ground, you're going to pay a much bigger price, so you
We will help you organizations, individuals and countries even too
It's britain, your because you been studying the past, understand your future problems.
I want to do this now. What was your methodology is all the more like different than historian? I went
It didn't seem to be is only people in different walks of life, give you feel it
we don't just assign. I see something I want people understand how you challenge your own thoughts to come to this. This. I am practical. I have to bat today on what's happening today,
I have to bet tomorrow on what's happening tomorrow, I'm not a historian who just likes to read the stories of history. I'm a practical guy who's got a place. A bet at my performance is measured to three decimal points. I have to do that. You know I. This is practical, stop on a and one and and it's just like you said you have to accept reality. Just like you said if you are have a condition, diabetes or whatever. That is you have to accept that reality. I'm seventy! Two years old, I've got to accept that reality. I've got to deal with that reality. Okay. That means that, on on less likely to have the next fifty years than somebody is twelve years old right
Oh, I know those realities. Okay, so we have a I'm just building up a what you said cause we agree. So what I'm trying to do is accurately show those realities with measures so that people could judge those themselves and then I have a principle which is, if you worry, you don't have to worry, and if you don't worry, you need to worry, because if you, if you worry about the things that is likely to take place, you can prevent it. You know this as you pell people with health or wherever it is. There are things that you can do to make your life better if you worry about them and then take action to deal with them. So I view this as a helpful book. Okay, this is not destiny. Let me be clear eve. It it's cool, there's, collective!
and then there's the individual. I can. I think I can help the collective, and I think I can help the individual, but on the collective and it's all about how we are with each other. Okay, it just all that's all it comes down to think about.
We have more. We have more wealth in the end the united in the world than we ever had
We have longer longevity. We put more output per person. We are
Well, then, we also have the fabulous inventiveness of technologies that help us to think in an event in a faster way: artificial intelligence and intelligence, and the like this is this- is been, never been better. More probably gonna keep getting and improving at a fast away if we don't damage each other, so we theirs.
certain things that we can do we can, if you work well together and invest, for example,
asked in those things that produce productivity that actually raise are in
comes and raise our living standards and deal with dealing with the death were better so, for example, education, ok spending
engaged, as you know, my wife, and particularly, and made me too, as I tag along, is dealing with them at the educational disparities in the state of connecticut. What you're down I'm just not touch on the four minute genetic is one of the richest states in the country. Twenty two percent of the high school students are either disengaged are disconnected disengage means they're out there.
Failing absentee rate is greater than twenty five percent are failing classes, disengage means they dont go to school.
So they don't know where they are one in every five. The education system is working as a result. What happens? Who was their community and what is their job? The community is the gangs, literally gangs with shootings and the army and the incomes come from crime, and that produces problems that this aside
It also produces high incarceration rates and so on. So there is no better investment that a terrific aunt and an investment in education or in the
for structure we've, let our infrastructure collapse. I think it's my generation. Unfortunately, it's my generation may be, to some extent your generation on my own. When my parents existed, they went through the depression and war and they came out in that they were called the greatest generation by Tom Brokaw in my generation, it's leaving them with big debts and a broken down infrastructure and and a and a substantially suboptimal education system. Do you know that today and the average education for a mere
wiggins and testing scores put us in the bottom third of all developed countries, and that social mobility rate is one of the worst in the developed world. We always thought that there was opportunity and you can change so those things have got to be fixed, they can be fixed, but the worst thing is: let's not fight with each other, let's not on and so on in in a combination. Yes, it's a combination of taxes and it's a combination, but the key is what not and not where you get the money. The key is what you do to invest in the future to create a better, more productive result of people working well together. So as for me, I believe that we need a very strong middle. Okay need a very strong bite.
Artists, a job. I think that we have a problem, because the two political parties have among them more also extremists and in order get elected in either party you ve, gotta, be fairly extremist and what you
need- is a strong metal in order to be able to have a mandate and follow that through
but in any case how we are with each other is going to be the biggest thing and that's not only domestically its internationally
let's not go to war, okay, but you're, right wars. Typically last a few years, let's, let's even be clear about that, because that's a very, very scary thought- and it could be- you know aunt and ma
and warfare will be much more advanced than the last time you had a world war
Warfare, as you said first before it's even the military side, which could change at all that the capacity of humans to destroy each other is never been greater, but but at the same time, and if we don't go to that warfare and yet you are
through then there's a heck of a competition, and then the systems will compete and from that competition will come productivity and all those things. So it all comes down to how we are
the job we are at a juncture. So that's the collective for the individual in the book. You know I'm a talk about. You know how to protect,
oneself in investing, you know how do you have resources? You are out. You have enough resources, and not only with that enough resources. You know how do you make sure that your protected well in an all
that said. The book is that this will be. One has not just one question of work even going to talk to you now
we gave you the closest, was of a war we ve ever been before the people.
don't see that as a possibility. A lot of people, don't other people, just overreact, but you know it'd be
for people who stand for two seconds, his deserted you. What happened
if you, civil wars are sometimes one of the things that occurs and why do they occur? Let's touch on there and then let's talk about inflation for a second. If we can, where we are you crazy
and then maybe wrap up with the individual and what they can do financially, as well as personally and on the relationship side of things like you've just talked about the collector. So could you touch
you a brass globally.
It was all wars in the past. Why have you
This bears an idea
you've. Given us the solution, we have to find the middle of some strong leaders in the middle. I never I I worked with president Clinton and I get crossed
on the same day and went to work with us because the house cambridge,
today, I will be totally impossible.
You're doing it
It will help each one do something wellesley recently of its bite. My fight
the earlier today,
because I, like really matters of togo.
What creates not review with understanding and has happened, the store with another way. These occur. Why,
to each other better
I live in that where we are right now with ukraine and russia since you're talking about war and sanctions and where inflation is okay and yeah. What happens
is, and you can see it in me out the french revolution. They call him revolution that their civil wars, the french revolution. They are russian revolution, the chinese civil war. Ah they cuban civil war, they it'll on many many many many many many cases hitler europe at the end,
fascism and communism and all of those types of things. All of those happen. When you get to the stage where there is populism in you lose the men,
another word: you get those on each side when the causes that they are behind is more important to them.
The system the system is in jeopardy and women become they become fighters
Ok, and so that is not a means. They don't get together. They don't say now. How do we make this work for about them
how do we compromise the middle is perceived as weak, and
nobody has to choose in like in the end, the french revolution there was a middle alot of people said we need change, we need to be
those about in the middle or they were you, know, guillotine and and so on. You have to get on one side or the other and you're forced to otherwise you're perceived as weak and so self reinforcing. You know that certain relationships you can get beyond talking. You can get to the fact that no, I am an ongoing to her. You liked the supreme court decisions
good day in the air? In other words, I will not obey and when you say I will not obey your in a power, make me kind of situation and that's a dangerous situation now it could be, I think, we're seeing the movement to different can
state arm along those lines. Because of the I want to be with more the people, I want to be with ab similar values and also will deal with me economically. The way I want each, what makes those choices that causes to some extent
following out. When you go from up, let's say at new york or a california to it, to a larger to texas, then you can lose the taxpayer
his and then the polarity that bore it more difficult. An app process has always taken place and that's what it looks like and that's where what were operating with now
How can we are reviewing around the world
for us we could have been pulled. That also weakens you for rising power,
How do we survive that?
time. First names you think were really there, because
What country is looking forward to our people
I find those exchange you're talking about, but I see them in the media a lot more than I see them in real life more
We are in the middle, but I think you would have any understanding of if you watch the news.
Address. What your experiences have gotten, then, how we make it I question, but what was it
at the time the civil war and allowed us to get through this come back together, while of course, at the civil war, there was a
I'm in a power that militarily beat the
the power and like all of those things, then the then they weren't
draw, and they created a new world water, a set, a new grammatical water, a new domestic water that was at all with what the various rules of
commerce and slavery and and such things, it was because they won the power and the and it was in on a per capita basis. The worst war we've had- and you know so, yeah it's a it- was a terrible thing and that's how that happens right, and so that was
in europe, it's been a while, since we've had one of those, but we did and- and so and regarding your second point- and I I think that and nobody knows exactly how they go, and I do agree with you that there, the middle as bigger, if you look at if you look at but the coupon, but the extremes are more in control because we have two political party. So what we have is, roughly speaking about thirty,
percent of the population am twenty. Five. Thirty percent is fairly extreme right line measures and all in all, almost and almost violently, so in other words, would be in favor of only overturning the elections and so on, and you know I dunno, maybe I'm not following the rule of lawns of such things about a fifteen per cent of the population. Maybe it's ten fifteen percent is rather extreme left so in there and there's no party for the middle, so in that you're getting an a a a a creating of who wins the primaries, and so on tends to
it's fairly extreme este pilot cars. Thirty percent of the population represents the majority of the republican party right, even though there are a lot of moderate and, and so what I would believe was what I had hoped to is that the grt and the americans have used. My estimate
Ah, you know somewhere in the vicinity of thirty five to forty five percent of the population might be more extreme, but let's call it thirty. Five percent and sixty five percent is in the middle, but they don't have a plan
for they don't have a later. They dont have everything, and so you continue to get that polarity and now how it moves. It is moving very quickly in a bad way. I mean it,
conflict way so measures like and what percentage of the population of of each of those parties think that it would be better if members of the other party died. Okay, one party has ten fifteen per cent. Neither party has ten percent. What percentage of the party says I'd? I would not want my child to marry a member of the
we are the body, these are significant percentages, so you're seeing this movement in that direction, and how does it work exactly? I can't tell you, but it is a fact that I, you know, gun rights and the ability to have
guns, but there are many more guns in america than there are people in terms of that at an end, some of those people.
We'll say you don't make me or could be I'm not saying how far it goes on and on
I dont know anywhere out far goes, I'm just trying to say that this is a problem, that it is a problem that the middle is not there's, not a strong middle and and there's not a strong pulling together. I think the president of the united states should be by part. Is it? I think it would be great if they had a bipartisan?
cabinet and they brought the people together and and that those in the middle I had that commonality that you talk about,
and then those in the other at the extremes, where the odd ones out
even if there was a civil war and when
If the kids are not over extreme and we all can play a role in that by our own decisions, how we interact with each other, as you said,
there is. It weakens us, along with a financial weakness, floor, rising power, so that
It was a about what's happening in your view with ukraine,
it was russia. What we're doing there were supposed to destroy the ruble by your policies and it's gone through the roof. It's creating a different relationship.
when what your view is about and how to what china looking out, because you
I believe that if we were going to war with china, if I did not miss floating you
Visa Taiwan's could be one of those traders. Obviously, so I'm just curious
Your perspectives on ukraine and russia are our policies,
do this. What does that mean?
This changing roared well like in,
there are conflicts
There are two sides:
there were like there were the allied and access powers and
they change where the geography was, but starting in nineteen hundred we added a world that was closer to each other, that you would have a world war
world war, one world war two and that means in the in europe and the pacific and so on.
And so you have that dynamic. Now that we're coming quicker together and there are asides and and and and there are sides based on a common enemy so on in terms of this conflict and the united states, as a group
the power at which is declining relative to the other powers. There is that emerging conflict so what's happening in russia and the ukraine is part of that. Greater story in terms of that and china is outside of it and now odd, because no one knows how a war is going to transpire. One
Really learns from the actual war. There always surprised. This is a very interesting observation now for an
china and others are learning. How is this transparent and were learning? Three big things were in the process of learning these three that three big things. The first is, ah, ah, they ve kept it to a convention,
war. Ok, they have intentionally not gone to make
anti a nuclear or cyber or chemical war. Okay, that that's in a sense good, though there's the risk that it could be so. The first question that we have is, and is putin going to win or lose, or what would account
What might look like? Ok, putin, winning and russia winning consists of a few things? First, get control these and part of the ukraine. Second have the russian.
I wanna me not collapse, but in other words it can, if it had a contraction of ten or fifteen percent of gdp bay, that's a tolerable contraction and, in his view, and none of you worth it getting a east brother, you get number number
ray is that he remains in power and
wherefore is that he remains on the world stage such as go to a g20 meeting at and now things go on pretty much as if that happens,
winds and the west lose in terms of that that that game now that's a problem, because these things always resolved who's, the winner and who's, the loser? If he doesn't attain that, he will at those things he probably would escalate it's a scary situation. How would he escalate and so the aunt, so we it's almost difficult to say: is it better that he wins or loses? While what I think and we're going to,
find out the answers to those questions before the end of the summer. I think- and my own guess is that because they can't make it look like anybody wins or loses that they have an armistice or what but a mean a cease fire the way they had in korea, and they just brought the border lines and they say that that's just a temporary cease fire medic and a maybe it sticks. Who knows, I dunno the second, so okay, first question: does he win or lose and out does? Our second question is: what are the powers and cost of american sanctions? The powers is another words: can can you really shut down the russian economy
can you shot things down so that you have enough of an effect so that you change the outcomes and arm so that everybody is looking at that
chinese, a look at it that everybody's looking about one of the powers. The costs are significant too, because what word, what we're doing is ah, ah on
de your politicizing or weapon eyes in the
Angela and economic systems, so when you arm politicizing
Freeze a country's assets, many other countries today
wondering, should they hold those bonds in the united states, because all if they get sergeant summit
The countries are neutral or at or against, they could get sanctioned and that's a risk and that could affect the capital market and it also produces great inefficiencies which are economically costly, because you think, okay, what were the supply lines? Look at what happened and the efficiencies are not there, and so that's the sanctions and all of that are very, very costly, so we'll see where we're in the process of seeing that you know so far on the sanctions are
we aren't, are not shutting down the russian economy and and and so on and they're, not having a change in policy on and on. It is a very important question, because sanctions are the united states's. Only
unique power. Now, because the military power and the economic power has become more comparable than it was before, and so it's the only thing so you sell so that a boy and the third thing will
say, and we are saying, is how the sides align, and basically until the allied powers and the access powers in europe and in asia, and we're so we're seeing that and who will support russia who will deal with russia. So when you look around, you can see, for example, arm
which ones are new joint that india, Brazil, indonesia met mexico.
oh, ah, ah middle eastern countries until and so forth?
still dealing with russia in and in ways and had not
the way that you'll see whether the cup, which countries on which side which countries on the other side all countries are increasingly being forced to pick a side and go into asia in those countries and and speak to leaders has been the most leaders and they're saying you know, which side do I pick, because I'm increasingly picked to pick a side when you see the President fly around the country are easy. Representatives excuse me fly around the world and you see others flying around the world. That's basically the epic aside near the consequences. So that's what we're seeing now and I think that before the end of the summer, that those questions will become clearer and light lenders for the next stage that that the china situation on is very concerning
I because, as I say, russia as an is not a comparable power and it's a it's relatively economically, it's a minor power and and you need all of the powers. But china is a different story, and so we have that now- and I I you know, I know both american and chinese leaders and I think that and- and they would say on that- it's very very important to know where the red lines are and not to cross the red lines to go into that kind of a conflict. And and well as you point out, Taiwan could be one of those situations and at some point it will find some form of resolution.
Ah, but you know, I would state say still: the odds are that they won't cross the line for the military, but our risks of it are our great. It's, like you know, to two giants wrestling with each other six feet from the edge of a cliff. Ah, you could say: ok, but if
You know you, you can go over that edge of the cliff too easily itself. That's what it looks like to me
the lack of effectiveness of these changes, Z, my china, also when they look at
but they might do not deal with consequences. Reveal overnight.
if this doesn't work
you mentioned just what is happening with these accusations.
it certainly encourages some other forms of conflict to a girl. Users must, as a bicycle sooner,
it must, after two seconds last two things that I made with you. I will connect to the individual, be adhered think. It's so important
rejection of this legislation
from the night. You know you two thousand eight argued scriveners, globalizing, digitizing and blooming
I do using debt
it'd get an hour in a different world we're in the beginning of a different way,
were review. I look. Exports is
you wanna talk previously. You talked about the fact that we already have this
problem with our financial system. Twenty nineteen before go for Google.
With Jamie all these emergency powers or used and wee wee dreadful,
times the amount of money we actually need to recover things. That's what
The sensation was coming from, can you describe where the inflation is coming from and what should individuals do during a time and place? Did you see? This is continuing. Are right now.
If that is your nose late to the party either trying to raise rates, and yesterday they raised them by three quarters of a point that mostly gone in twenty eight years in a single time.
But can he really raise it enough to to stop inflation or without having a massive recession? Give us your view of what got us here and where do you think we're going, and what can people do to protect
What god, as here is the the in
the action of a lot of debt in money. It's a high another word: you can hype it up, I think of it. As you know, you ve got, somebody is weak and wherever it is and you get a shot and then that shot a buying power and if the amount of spending increases by more than the amount of production
and prices by definition go up, and so there was a massive amount of giving away checks and and money, and
will seem surprised that big flash it while they're gonna spend that mercury
greece, very much in terms of the production and sale,
What it's gonna happen, the prices are, gonna, go up, one people spend more I'll get and you put on top of that
the issue of where we are on geopolitically, the white were changed the world and our resources are allocated
It used to be primarily that they were allocated on economic and profit basis. In other words, if it was more. Ah, if if some place was cheaper to produce something, then capital would go there motivated by a profit and it would produce added and raise living standards in those places. But it would move that profit that production from places
that would have a hollowing out like the united states and so on in some jerk types of jobs and were now in an environment in which resources are allocated by political and ideological concerns.
Our issues, in other words, were not going to produce it wherever it cheapest and also because of worries
that we might be in war or that you can be in a war, every country wants self sufficiency and every country's worried or every company is also worry that they might be in a place where they are affected by politics. So if I heard it don't think about it and the nikes that you're buying the apples that you're buying an armed twenty two,
percent of all manufactured goods. Imports come from china, and just imagine if the world said it's where against companies
that are producing an operating in China? I'd like russia, let's say if that was the gates
that has an enormous economic effect in companies today are considering
I'll get. Where do I produce it and it's not always produce it in the most cost effective place that adds to it
patient you and that's our new reality, even bike who gets the money in the system.
thousand eight when they had. The financial system with the federal reserve did is, went in and bought a bonds and when buys bonds, its buying bonds from those who sell bought and that may in the bar and the bonds go up.
Then those were investors then take that my and they by other financial assets. It does not trickled down to the population and won't get the cheque to the person that needs to get
if jack and but in this last time what they did. Is the government determined who's going to get the checks so because the federal government can determine that so that the federal reserve buys the the debt of that? But the checks go:
where it's directed so the ideological, an aca on non economic forces in a sense, but those that have are being managed for a greater purpose and get moved that way and that's by the way, also very trip a typical divorce in all countries they become a command economy. In other words, if if
just left into the prophet system and people buying what they want to buy. It's not gonna get the resource allocation, a country needs and war.
You're, seeing both of those dynamics taking place in producing inflation. So what does that mean? There's a paradigm shift,
A paradigm shift is about a one in ten year shift in the perception of what's likely and what the world is. There was a paradigm that was created by a combination of
low inflation and also central banks producing free money.
in other words free money like zere, almost zero interest rate or a zero interest rates. That means you never had to pay. If you buy the money, you don't have an interest,
payment and that in many cases you had interest only loans and you didn't even have to pay back the principal practice
and also with low covenants and the war.
Ray calibrated to that kind of an environment. Ok, a paradigm shift is one that changes, and so americans thought
the people? There was a forty year, bull market in bonds, and they think cash is safe and bonds or safe, that's what they bought for. Ok,
and they did not realise. Essentially,
what there now realising
but their realising is that you can judge safety in the number of dollars. You have. You have to judge it in the amount of buying power you have, and so, if you lose money to buying power, lives buying power because of inflation, you need a compensating return so, for example, with an eight percent inflation and a near zero interest rate, you just lost eight percent eu buying power or almost anima. So then that changes behaviors as that change
behaviors people do not want to keep their money in there. I would not keep my money in their as long as interest rates are low in relationship to
inflation rate and the likely inflation rate
lose buying power. So that's why you see money moving, it's better!
borrow then dylan and moving out of that? What that does is it creates difficulty for the federal reserve, because not only the amount of bonds that have to be sold are no longer the amount of the deficit, the trade. You know how many bonds they have to sell. Well, it's the amount of our deficit. We have sell bonds for that and, if there's others selling
a bonds are because they're not good returns and then there has to be more and more selling and that and then you have the federal reserve choosing to sell that they're going to sell one point: one trillion dollars of ants, so he's going to buy all these bonds. So when we, when you look at that, that means that there's
the big tightening of credit. Now everybody says: okay, we need to fight inflation and therefore it's good that they're that they're catching up. They were behind it, but it's almost like there's no cost or that inflation is the only thing that people are thinking about the way you fight inflation is taking away buying power from people. I mean, that's how you do it right you it. You said: okay, now you're going to borrow last, there's going to be less liquidity and so on at the time that there's more inflation. So it's not like fighting inflation is one of those things or we fight inflation and that's a good thing and will be there get on with it. It means taking away buying power and that causes markets to go down and that causes economies to go down. So that's why we ventured a few of the legs and that's why we're in a period of stagflation
central bank is going to try to find a middle ground, but there's a lot of debt and somebody's got to pay back and you're, either going to get paid back in real money or you're going to get paid back in deflated money and because they want to deal with both of those things and try to ca have a middle course it'll produce stagflation. So what that means really is for investors,
is. In my opinion, it don't hold money in those assets set up. Those kind of low returns
and then on many of the bubble assets
They are always at the end of a paradigm. Ah people luke extrapolate what happened over the last ten years.
and they're sure it's going to happen going future in the future, like tech, no tech stocks and- and you know that the ok well- okay, no or that I went through this many times the nifty, fifty or or the dotcom bubble, and so on. That doesn't mean that the that technology companies won't do well or something it just like dot com companies. In terms of that, you know, but there's there's a big crash in those things a accompany when it gets very expensive and
it can still provide a terrible return. Some of the best companies can provide the worst returns because they get too expensive and so we're going through that kind of a of a dynamic which again I emphasize, is to me and don't be an a have, a balanced portfolio and an end with a skew towards inflation, hedge assets, although there will be and the medium in the near term, on over the next probably year or maybe last ah, but anyway, let's call a year or so there'll be a tightening that tightening causes the corrections and and downward moves in most assets.
because cash and the cubs have a problem and and so on. Then you have that correction and then you'll have the federal reserve come back in. I believe and then print a lot of money and buy more because that's going to be the problem, so we're in that part of
cycle. You can either maintain a balanced portfolio through that, in which case, if you're having a you, know something like the all weather portfolio or something which is one of the all seasons, portfolio that you have that'll. Have that type that's a type of time. When you add the correction but dudes, you maintain that type of balanced portfolio, because you're also saying that the inflation hedge asset, part of that part of that portfolio does very well, although it doesn't compensate for the hall and you ride through it or you make the tactical moves that navigate it. So I would say that that's important and I think international diversification and m it is
it's so important. Now that becomes more complicated and will get me into a longer answer than you. Probably have time for, but that's kind of it in a nutshell, you talk about the the holy grail of investing. You really know here's the idea.
Even if you get half x number of assets,
you haven't, you talk about eight and thirteen. You just have one you yeah, if, if you, if you have on correlated
I said anne you easily can because, when the economic policies, when economic conditions shift, it shifts, returns from one of assets to another kind of asset. So you, when you have on coral
I did or low correlated asset, you can dramatically reduce your risk without producing your return, so I mean just it give. That is
Example the holy grail of investing- and you don't have to do it or it can be five. It could be ten, it can be fifteen, but you will cut your risk in half or if you get out at ten or fifteen, you will cut it by eighty percent without reducing your return,
and so it more important to know how to diversify? Well then, it is even know how to to the best best and and one of the problems of the world is that everybody wants up. They want up in the stock market, they want up in they real estate market, they want up in the economy, and that has an central banks can produce up. Ok by giving it a shot of money and credit. They can always produce that up, but that up over a period of time has a consequence, and that consequence is that there is a lot of debt and that has to be paid back that will be paid back in depreciated money, so
You don't want to be in that position of like a if your. If your portfolio is going down a lot and in this- and you know, that's not good to give you an idea and if you lose
after your money, it takes one hundred percent return to get back. You lose fifty percent in it one hundred percent to get back. There are people who are in some of these tax funds and and and they're down seventy per cent. This can't be part of the gameplan okay, that that's not part of the gameplan. So the issue of being able to reduce risk through diversification, which doesn't reduce return- and I am, in my view, never be put yourself in a position that you could lose more than twenty five per said. An errand like your worst case situation. Twenty five per cent in again
that's a big can be acceptable, but if you go into that and if you look at any single asset and buying power on an ev, there is no single asset and in buying power that hasn't lost on a seventy five or eighty per cent. So you need diversification
your lifetime wasn't the principles for people tender focused
I grew up in appearance, fixed homes and they got into real estate and so real estates work for decades and all of a sudden it doesn't tour. They got into stocks
if you're at twelve years, older, holding the universe don't have and they go.
it up and up until they don't and they lose fifty or seventy five percent of that's the pizza people. Now those watching by the way, when you're talking about a balanced portfolio, redesign one, which is a money master the game for you. If you want to see what that is structured like as well last couple of two questions
to meet your china is rising. China's armies are much larger population four times
they certainly are building a worm. She is
We really are dominant drudgery worldwide over centuries. Many centuries is theirs.
based on size and so forth, in their technology
grow. Using capitalism clearly reveals what
megan grow even under communist country.
Guarantee to be viable winner in this race. Because you see
you spend more money on internal security building you external security, even though they're spending more than we are on the war machine more to control their own population. You see: what's happened in shanghai, with twenty five million people walk down for five or six weeks
It is, in my view, has always been kill. I mean: do you
They can be sustained in your line, Andrews and guarantee the wind. Will we be able to compete?
What is there to believe? You can trust us a little bit but I'd love to hear your view on china cause. I know you're chinese culture
I can't move more market. Why tat my work?
the psychology of indifference different, but I think it'd be
people see your view of china, but we stress
this decision is inevitable.
Stage china or other options. First of all, I think that the for the next number of years- I don't know what that's five or ten years they're going to be more a comparable power then-
im a dominant power and how that period of coexistence goes will be very, very important, in other words, the avoiding that and at the end of the day and the strongest will win out, and the most important thing is that the the united states it becomes the strongest and- and we talked about that- in other words, how to work together on and how to be productive and have education and all of those things that will determine the biggest outcome and about you. I have to recognize of the power
China, as you say it to the number of people, is more than four times our size so have on average it had a per capita income of half of bars. Then its economy would be twice the size of wars and, if its twice the size, that means twice the size of buying power on anything you want to buy, whether that stick analogy or military or
thing, that's that's a reality, and since I started to go to china, nineteen eighty four and I have gone there repeatedly and I love the place at night, and I have a lot of respect for the pleasant and the people and in various ways,
got to know it very well, and I love america. Let me be clear and they have lived the american dream, but I'm making the point that I've known it and I've watched it and since I started going there, nineteen eighty four, its per capita in grey income, has increased by twenty seven times its and ets and life expectancy is increasingly ten years.
it's ok, so that there is. This is a very viable competitor
and where we will be twenty years from now on is going to be mostly depended on. First of all, are we going to have a war with each other, or are we going to then be able to compete our systems competing and then can we compete effectively
I think that the desire to have a boy to war that's of paramount importance. Then it makes it less important whether
or they are richer or we're richer or more powerful, because there are many people in many countries that are not the most powerful that are having a happy productive lives and in their own ways. And so I think that the war thing is the most important thing out. Otherwise we can and then will be responsible for ourselves and our outcomes. So I think it's that that's
important their economy. Currently aging population
Our internal strife by these issues, as well as they already you ass, lord warburton. Certainly,
There are, I think, it's something like two hundred
seventy five million people who are over, I forgot with its sixty or sixty five and with that because of their one child policy. It used to be that the young would take care of the old. But now you have a very difficult burden because you have to old parents were now in that situation and even the medical
wisdom and so on. That's a great burden as a great burden and an and then they have on. You know a lot of a lot of issues, a lot of ah everything from weather issues and so on.
So they have a lot of problems,
we have a lot of problems they about. You know a large poor population
and under developed now that both potential and problems
and so it goes back to euro. How do the? How do we deal with our problems? Very well?
about all, really be it
tell me you I'll, just you
I was going to summarize the most simple terms in order to avoid the three things that kind of
guarantee that decline,
staring less than you earn. Instead of many more than you earn, an individual level
Meat has more collective level, is critical
bringing ourselves together and connecting a greeting goes deeper relationships with people?
police systems, but what weapon?
individual do justice to summarize, the collective due to start or slow the decline. Clearly
Here you can measure has occurred, burst financially, be financially strong, have a good income and balance sheet.
Statement and balance sheet, think about how many months or years years that you could live. If you were on, if you didn't have an income,
The more he financial security you have, the more maneuverability you have both to protect yourself on the downside to take advantage of opportunity
and to know how to achieve a balanced portfolio. This is very important. I think financially naturally, and then be with people. It left the ear community are the source of happiness and psychologists have studied that above a basic level on income is not a source of happiness. Community is the highest rank source of happiness, so how you work well with others, so I think meaningful work and meaningful relationships to be productive and to also
I have the joy of those relationships I think is of paramount importance and and then also to realize what the risks are and that's why I wrote them in in the book, and you know the risks of like a can you, while there are many kinds of risk,
and you understand those risks and where are you a word
live? What are those risks like to recognise that the world is domestically and internationally
breaking into different ideologies and different economic systems. Really, on that happens, state
state, as well as around the world and to understand which are the places that are the best. For you ended, though said.
Circumstances to be aware of those risks and and and that then it's just the fundamentals. You know raise your kids well and and nice product that I should say that in most of these cases, even the worst case situations it's okay for most people, okay, the most in most wars, most people don't die. Okay, most people don't get injured. Okay, most people down in most depressions, even most people don't get unemployed, are ok and they are scary situation, an app, but it's not the end of the world for most people and may be meaning cut, backs and and so on. But you know that's often good, because you know it it it it's! Okay to you! Don't want to get spoiled, you want to be self sufficient and you can get strong. Sometimes
So those are the things so most people can get through these things. Fine just understand what it's like, and you know a navigate that well since the messages that the future will be.
Your best. If you try to judge what do you do in future,
the vast alone, already missing, all understandings of history that can help you anticipate and do well,
and you are above, was indeed a day in his address that
inflationary times. The most important thing is to become more productive, that if you're a great doctor you're great nurse, your great account
If anything, you're really invested that you won't matter what happens with the currency. You still have the man for what you do
important thing besides having a productive business that hopefully doesn't have too much cap, Patrick too much expense to make it work or do the things he talked about as well:
how do you think what would be my really brigitte using the others is not the end of the world.
again after what? What? What is meant to do? It closes off the weakness and opens up
new openings and in the news, his brains out, but the good news is drawing
dockers times this morning? Is always the house's darkness before the dawn. There's a reason we use these.
raises- were your hundreds of years, because it's true
really appreciate you marking out? This is not in the world, but if you don't anticipate it's going, it's gonna be a lot more painful than if you do
Why this little jirga, where you aren't like looking where countries are, is such an important element
I want to just finish asking you about the power meditation, as it were.
I, the with always things people get overwhelmed so easily into these days resume at coming at us, and we
it come out, is through technology. Very often you've been a lifelong meditator. I love, if you just tell us how important that's been, what meditation has meant to you and how could that as well
marriage will be useful for people to retire slackness, whatever success, I've had has come more from meditation than any other thing
other influence and on you- and I know, because you you're you're, a meditative data- are women
David in your room, your meditation room
We know what it is and I'll explain what it is and it and it all first explain what it gives you and then I'll explain how it gives you. It gives it to you and it gives you an equanimity, a ability to almost rise above yourself and to see things
in this and thoughtful way, almost like a ninja in a ninja movie, as things are coming out them, everything SEN seems slower and you approach it and you can deal with it in that way and it gives you on a greater level of creativity and it does that by arc enacting your sub conscious to your conscious. It achieves that by repeating a mantra. So here's our orcs there is a sound that doesn't have a meaning, it's a sound. We could at, for example, it could be something like one and mentally. You repeat that over and over again you close your eyes. You get uncomfortable position and you repeat that and you'll find that your mind will go to that. But then it'll go to
what's a new, just sale, it's in thought and go back to arm and you get to practice it and what? After a while, he also stay in that meditation that mantra and then, when you're in that mantra. Ah, it will then disappear.
and then you go into a transcendent state. In other words, you transcend and you're going basically into your subconscious and you're in your sub. Conscious and your subconscious is really what controls you more than your conscious. You know it just you're, just not conscious of it, because when you're conscious you, you know, you think all well. What do I want to do and so on
but your subconscious has such an influence of the things you ve learned in euro earlier years, ear, genetics or something
They are not aware from you and when you go down into that, you get relief, but you also helped to make the connection between your subconscious and
your conscious, and so when they're a line, you're aligning you
emotional decisions with your intellectual decision, so I find it an instinct your thing for me to do what do I feel emotionally? Why do I feel? What do I do think about that? Intellectually and then how
Why approach that? In that calm way, it doesn't diminish your emotions on it? Just is you feel them differently and my my love is as much as it is as ever been my arm more, maybe because I feel differently, so I just want to emphasise it doesn't take away your emotions or anything it just puts them in the perspective is, and you look above yourself and you see yourself within their life's arc,
you see the strengths and weaknesses and how to deal with them a new navigate better or have the year with the charge.
It gets in the way of people making better decisions, it kind of dissipates the charge that people often have that makes them overreact.
it's amazing you've done this and usually do I view our twenty minutes a day twice a day. What is your regiment yeah? I try to do it twice a day for twenty minutes, each time, usually before breakfast and before dinner, and that I'm not perfect. I know I would say, probably a third of the time I do it twice a day, a third of the time to do it once a day in a third of the day days. I I I miss it, but there are times where I could just feel I just want to go. Meditate I feel ah it'll just make me feel so good and I get that whole. So I can, it can be anytime of the
I almost and any set of circumstances cause it's very refreshing and relaxing it's almost like going on a vacation, the toy user level you just described, you said people get so rigid
dragging himself about meditation, becomes about something else. I'm really nice of you to share that. There's a variety of how this works. Really.
Someone's serves the needs, but there is a consistency that allowed you
continuing fine balance in your life
unless we give this last december in your life, these last five or ten years
given so much. You know you got your cup,
you ve been so successful and now you're in the stage where you really measuring always and giving us,
sites there. You I'm a big leave. People experience. I can only you don't
decades. In today's unanswered you trying to help us deal with you,
I know, have one more book and you understand. I don't want to wonder what is that book when is it coming and what's next for three dollars is my final question and the book will be economic and investment principles, because that's what I focus most on. So it's like a doctor describing those
principles, I'll I'll I'll. Do that and and then when I after I do that, I really believe that I will have passed along anything that I have is of value and I'm going to go quiet and go to the things I love and and enjoy, but the less I won't be as at I won't be
passing things along I enough for another view of conversation. I hope people watching here
The essence of this is a tool that can help them anticipate
if they are willing to anticipate they have an extraordinary quality of life, no matter what the season winter spring or fall. There are these
it will cycles
in a very short period brings to us I'm also going to put the link below. I recommend all of you get the book also recommend you watch the video I wanted to three times. You wanted economic cycles, I'd probably watch thirty times, but it's just so clear if you want,
thirty, and how do you do
it'd be able to understand more depth. Please go to the lincoln police and also make sure you pick up a book re. It's a pleasure always be with you. Thank you so much and thank you time because you helped so many people in so many ways and we had a great simpatico and it's really a treat to be able to do this with yourself. Thank you.
The tenor of this package is directed by tony robins and produced by the tiny lemons t, copper,
robins, research, international.
Transcript generated on 2022-08-11.