Kudos to Pak Gita Wirjawan for orchestrating such an incredible episode with Ray Dalio on the podcast! It's not every day you get to witness two titans of finance engage in meaningful conversation. Pak Gita, your ability to bring thought leaders like Ray Dalio to your show is truly commendable. The insights and knowledge shared in this episode are priceless. Thank you for making this happen, and please keep up the fantastic work. Looking forward to more outstanding content like this!
Never had I imagined that one day Ray Dalio himself would be speaking in an Indonesian Podcast. I must say that we, the people of Indonesia, are very proud and thankful for your efforts to open a lot of doors of knowledge for us.
THE CONVERSATION WITH RAY DALIO Up Close & Personal 01:50 - Family background 04:53 - A different Ray Consumerism & Inequality 06:51 - Time preference of different generations 11:29 - Current societal challenges to nurture low-time preference New Age of Capitalism 17:27 - The updated version of capitalism has to : 1. Work for the majority of people. 2. Support productivity for the society as a whole. 3. Internalize externalities, including environmental and societal externalities. 4. Reform the governmental system to reconcile polarization. Breaking the Historical Cycle 24:25 - Gita raises his point on the possible cause of polarization : The lack of talent in the people who are in power. 31:46 - The world lacks of concerns about things that matter because the impacts have never happened in our lifetime - and that’s where studying history comes in. 34:43 - Minimizing risk in grabbing opportunity : Lessons from Bridgewater. Storm in the Horizon 39:20 - World’s 100-year cycle. 48:01 - Is this 100-year cycle an opportunity or threat to Southeast Asia? US-China Outlook 52:32 - US democratic turmoil vs China’s autocratic journey. Climate Crisis 56:53 - Gita raises the paradox of sustainability: Renewability vs modernity. 57:52 - Three costs of climate crisis: 1. Brown to green energy transition. 2. Infrastructure to adapt to climate change. 3. Damages due to the climate change. 1:00:10 - How do we get underdeveloped and emerging countries to take part in this issue? Eudaimonia 1:01:42 - Ray’s advice for a 10 years-old 1:07:54 - What makes Ray happy? Selengkapnya di : sgpp.me/eps158notes
wah Pak Gita kereeenn, tujuan mulia mu untuk ingin lebih membuat Bangsa ini lebih mature secara pengetahuan dan cara berfikir emang terasa sekali, thank you Pak Git!
Gila, keren sekali narasumbernya! Terima kasih banyak Pak Gita Wirjawan sudah menghadirkan Ray Dalio ke EndGame. Senang sekali rasanya bisa belajar dan menyimak percapakan ini.
Suatu kehormatan bagi saya karena mendapatkan ilmu dan wawasan tambahan yang sangat berharga dari Mr. Ray Dalio. Terima kasih banyak Pak Gita sudah mengundangnya di endgame. 🙏
Thank you so much Pak Gita for presenting this wonderful podcast with the wonderful Ray Dalio. Thank you so much Ray, for your books and animations that help a common person like me to understand economy easier.
Its so amazing, Terimakasih Pak Gita Buat Percakapan 1 jam 10 menit yang sangat menarik untuk diikuti tiap detailnya, saya juga penggemar dari Ray Dalio jadi jika ada yang mewawancarainya itu sangat membuat saya bahagia, Indonesia beruntung punya orang seperti anda pak Gita, Sekali lagi saya bertrimakasih, semoga bapak sehat selalu dan semakin diberikan kebijaksanaan.🤗
Sejauh ini, inilah podcast youtube yg paling jauh sih, thaNk you pak gita bikin kita melek cara pemikiran orang2 crazy rich tentang menasihati cucu2nya..❤
Trima kasih Pak Gita udah menghadirkan Ray Dalio, seneng sekali bisa menghadirkan beliau trutama dengan buku nya yg banyak jadi perhatian dan menarik sekali tentang the world order. thanks pak.
In 2023, American investor and author Ray Dalio participated in a discussion at the Ubud Writers and Readers Festival, focusing on the theme of "Past, Present, and Future." During the conversation, Dalio reflected on his upbringing, crediting his parents' love and early involvement in the stock market as shaping his financial journey. He emphasized the importance of financial education, advocating for prudent financial practices like saving and investing. Dalio also delved into the rise and decline of empires, pointing out the critical roles of education, innovation, and the establishment of a reserve currency in these historical processes. Additionally, he discussed the potential global conflicts and opportunities in Southeast Asia, emphasizing the region's ability to thrive by avoiding war and fostering productivity.
Org dari keluarga miskin harus berjuang utk mencapai kemajuaan utk keluarganya serta saudaranya..semangat berjuang menata menejemen keuangannya supaya keluarga terangkat ke tingkat yg lebih baik atas bimbingan ayah dan ibu memberi semangat berdasar❤❤
Ini pembicaraan yang sangat sangat sangat berharga, bagaimana orang belajar, bagaimana suatu masyarakat belajar menuju masyarakat sejahtera, coba refleksikan dg situasi indonesia dari awal pembangunan 70 an sampai sekarang, menciptakan ribuan lembaga pendidikan dan hanya menghasilkan kertas berharga yg disebut ijazah bukan product yg bernilai berguna utk pasar dunia.
Channel UA-cam terbaik di indo, tamunya bukan lokal , global juga penulis2 hebat . Bisnis, psikologi, sosial, politik , ekonomi, spiritual, islamis dll. kishore mahbubani ada, John Mearsheimer, yoval noah, ray, sadhguru ,aduh sampe bingung . kelihatan sekali kalau youtuber yang banyak membaca + kemampuan menjangkau relasi hebat ... sangat membantu masyarakat. gak ecek-ecek , top dah. Manfaatnya hampir sama kayak membaca buku,. Semoga berikutnya ada "nouriel roubini". (Penuh harap) penasaran dengan ucapan nouriel karena menulis buku "megathreats"❤❤❤. Sehat selalu pak gita .
I’ve been at time machine when hear this conversation, much more lesson and learning about past, present, and future. All about the end game things is on a lot of value to takes to get more productivity in our life cycle with balancing the kindness, peaces and takes the opportunity smarter enough. I’m a millenial and thanks for this quality meditate
The interview is nice serious and at the same time relaxed. The interviewed is awesome, what lucky are these grandkids!!!! who wouldnt like having a dad ora grandfather like him? God bless him
Thank you Mr Gita & Mr Roy a wise dialogue to be a perspective for developing personal strategies during this era, especially as individuals to keep track of how capitalism works and be innovative and use all the potential around for productivity and a unique way with the self passion, really enjoying this episode
Love from Australia on the best interview of a hero of mine. Gita, you are a discovery for me and your intelligence, knowledge and humility comes across in the interview. Well done.
Halo pak GITA, saya NUR AINI, warga negara Indonesia, yang sekarang berada di Penang Malaysia, saya sering nonton acara bapak di UA-cam, tetapi yang tidak saya suka iklan nya selalu, iklan Malaysia, bukan saya benci dengan negara Malaysia, tetapi karena saya warga negara Indonesia, saya sangat bangga, apapun itu tentang negara saya yaitu Indonesia, karena sayang menganggap UA-cam, adalah pengganti televisi, jadi saya suka melihat berita berita, bagaimana perkembangan republik Indonesia, semuanya dari Sabang sampai Merauke
Thank you so much Pak Gita for this podcast, kinda open our eyes & make us understand about the situation in the world right now. But who decide everythings are the world's leaders, not regular people. They should think every human being has a right to live in freedom, wealth & equality. War just make people suffer.
coincidence? Lately I've been watching UA-cam and Raydalio's book for evulation and reading e-books. I can chat with Mr. Gita, have a fun discussion, joke around, can my intuition and intuition tell me the future?
thank pak gita with this podcast....with legend Ray D... banyk sudah ilmu yg disadap dari podcast engem....thaks Sir....wishng good health & happnes For u Sirrr....
I think when we are in a scope with a bad connotation, it doesn't mean it's always bad, because in their case it's the past they grew up in and the habits of their environment were created, and as future generations we need to invite positive activities that build a positive environment is a problem solving ,thank you pak gita its a great room discuss
(1047) Ray Dalio - Pola Lahirnya Adidaya Ekonomi | Endgame #158 (Luminaries) | UWRF2023 - UA-cam ua-cam.com/video/f5xkLvq-MUw/v-deo.html Transcript: (01:02) Welcome to this year’s special collaboration between Endgame and the Ubud Writers and Readers Festival. The theme of this year’s festival is 'Past, Present, and Future'. This year’s guest is American investor and author of “Principles for Dealing with the Changing World Order”, Ray Dalio. The aim of this discussion is to explore and reconcile the idealism versus the realism of the future world. (01:28) Enjoy this episode. Hi Ray, thank you so much for gracing our podcast. It's so good to be here. Thank you for having me. I know you've written so many successful books, and we in Southeast Asia are very keen on a number of things that you could shed wisdom upon all of us in Southeast Asia. But I want to explore a little bit about what values that you were brought up with that made you the the famous Ray Dalio, who I think can share a lot of wisdom to the rest of the world. (02:03) Well, I was lucky to have two parents who loved me. My dad was a jazz musician, and my mom was sort of a stay-at-home mom. And I don't know why, but I got into doing work such as delivering newspapers and so on as a kid and earning money. And then, when I was 12, I was caddying, and the stock market was hot. (02:34) And so I got... I didn't know what I was doing, but I got involved in the stock market. I remember the first stock I bought, which was the only company that I ever heard of that was selling for less than $5 a share, and I figured, “Well, if it's less than $5 a year, I can buy more shares, so if it goes up, I'll make more money,” which was a stupid idea. (02:59) But what happened is that I got lucky; a company came along and acquired this company that was about to go bankrupt, and it tripled. And I thought this game was easy. The game is not easy, but I got hooked on the game. That had an effect. But mostly, I would say having good parents. My dad was a hardworking, you know, the classic; he went through the Depression and the war and was a jazz musician and hardworking but also creative; not a highly structured guy. (03:39) My mom loved me a lot. I didn't like school. That was a frustration for them. But anyway, that was kind of the background. I grew up in an era of almost unbounded optimism. Kennedy was president, the United States wanted to go to the moon, eliminate poverty-all of those things. I believed I could almost do anything, and I came out to a world of equal opportunity. (04:16) So I didn't like high school. I got into a college that worked very well for me, but not a great college in classic measurements, on probation. I loved college, did very well, and went on to Harvard Business School, which I loved. And I was in that world of equal opportunity. So that's kind of the summary. (04:49) You've talked a lot about those in your principal book. But I'm just curious as to whether or not you would have turned out the way you are if you had been born at a different time in a different country. I mean, you're the true manifestation of the American dream, right? But would we be able to see the same Ray Dalio if Ray had been born at a different time or in a different country? I think that… If you look at immigrants, it depends on what I was like; it depends on how and in what ways it was different. (05:28) But when I look at immigrants and how they get around their obstacles, and they're not having much and they have to survive and find the way, I think that that builds strengths and that those strengths and aspirations in combination drive you to what your passions are. And I think when you asked that question, I think I would have had a greater chance of that than if I was born into a rich family. (06:14) If I was born into a rich family in the United States and I had lots of privileges, I suspect I wouldn't have had the same drive. I strived to make… learned how to make money by working at an early age. If I didn't have those kinds of things, I think that would have caused me to be a different type of person, a more different type of person than if I went to another country. (06:51) Interesting. I want to talk about the current generation and compare that with your generation. You were born in the late 1940s. You've talked a lot about how important it is to spend less than you make. We're sort of living in an era where I think the current generation or the young generation is having a tough time deferring gratification. (07:21) What sort of advice would you have for the current generation or the young generation? There's this notion that there's this high time preference; there's not a whole lot of sense for low time preference. They want to get this instant gratification today and do not want to defer gratification until a future date. (07:42) Well, I'm just going to tell you how reality works. There are things that really, really matter, and there are things that don't matter a lot in your priorities. If you keep indulging yourself to consume and don't build savings, you are spending on luxuries now in exchange for great pain later. (08:21) You have to be self-sufficient, I don't care whether that's at a high level of income and a high level of spending or a low level of income and a low level of spending; that's an individual choice of what kind of life they want to live. But if you're not earning more than you are spending, you will be dependent on others, and you will be vulnerable and experience a terrible time when you can't get ahead of that money. (09:00) I mean, if you spend more than you earn and borrow money to do it, when you pay it back, that's going to be bad. If you still spend more than you earn because somebody gives it to you, you're going to be dependent on them giving it to you. The only way that you're going to get freedom and health is by earning more than you spend and building that. (09:28) I used to calculate at first how many days, weeks, months, and years I could live if money didn't come in. And I would feel good. The only time I felt security was when I could live for an extended period of time, which gave me a sense of having both freedom and security. So don't waste it. I give my kids and my grandkids gifts sometimes, but I give them a gold coin as a gift. (10:15) And then I'll give them another little gift, maybe a toy or something. And I told them, “You're never to spend that coin through your life unless there's a real emergency. And hopefully, throughout your life, you'll never have a need for spending those coins that you're accumulating. And when you get an income, you put the gold coin, you buy another gold coin, you give it to your children, you pass it along, and the day will come when you're going to have that. (10:53) ” And what they're experiencing, the children and the grandchildren, is that they're developing a treasure. Most of the other stuff is junk; they buy something, a year or two, or whatever it's gone. So I'm saying that it's in your interest to prioritize to have a more austere and secure capability that will give you power and independence.
(11:29) How more difficult is it to get that sort of wisdom in a household in a world where, as you've aptly pointed out many times, values are diverging and wealth is diverging at a bigger rate than we might have ever seen in the past in the last few decades? And how does social media affect the ability or inability to share that sort of wisdom for you to save for the future? Well, there are a number of things that come to mind in response to your question. (12:22) Everybody will learn through their experiences. When you learn through your mind and you're taught things, it's intellectual learning; it's not going to stay with you; you need visceral learning through your experiences. So we'll all learn through experience. Then we have a problem in what do different people learn in their environments. (12:50) And we're talking about that because, like I said, if I didn't have an environment that taught me the things I taught, like the need to work hard and all that, I wouldn't have learned it. And so, with large wealth gaps, one of the real problems of the situation that has always been through all cycles of problems is that as one earns a lot of money or enough money, then they take care of their children in a privileged way and whatever, and the children may not have to aspire. (13:35) And so, you see that rich people sort of get unfair advantages, and they are also not getting some of those strengths. And you see the poor people... I see this a lot; we work, my wife and I, but particularly my wife, in the poorest school districts in Connecticut, where there's poverty and all sorts of terrible environments, and in that environment, they learn differently because there's drugs, there's crime, there's gangs, and there's a problem in the school systems of being educated well. (14:26) We live in Greenwich, Connecticut. The average amount spent per student in high school a few years ago, so it's not up-to-date, was $24,000. In Bridgeport, Connecticut, which is a poor school district right up the road, it's $14,000 per student. So there's less money being put into that school district. (14:54) They need more because of the basics, like they don't have computers. And when we had COVID, they're supposed to learn on computers, but 60,000 students in Connecticut did not have computers because the families couldn't afford them; they didn't have it as part of their education system, and society would not provide that. (15:16) We bought those computers philanthropically to give them that. And when you have environments in which that is the environment, then you learn that your community is your gangs, literally; your income is dealing drugs; and your path is crime that causes incarceration. That's enormously expensive. In the state of Connecticut it's like $700 million a year because of that type of cycle. (15:51) And so they learn different things. That's just the mechanics of what we're dealing with. And unless we somehow as a society recognize that broad-based, you can't have a living standard below which people can't go, they deserve what I had, which is ideally two parents, at least one parent; in some cases, they don't have that, but they need the support to get through a public school that's decent and come out to a land of equal opportunity. (16:26) So society must do that or it will implode and collapse as homelessness, mental illness, drugs, and everything else increasingly shift things, as we're seeing take place now. So yes, you're going… Everyone will have different experiences, so somebody's got to rise above that. We'll have a war-an internal civil war -if we don't do that. (17:00) And that's kind of where we are. And so if you see the cycles through history, that's what always happens. The capitalists gets… There's capitalism, communism redistribute the wealth and keep the wealth, and unfair advantages. How do you do that in a way that is healthy for the most majority of the people, so they have good experiences? That's the issue of our time. (17:28) Special thanks to this episode’s sponsor, Pluang. Find out how you too can navigate big changes and open up a land of opportunities for Indonesian society by clicking the link in the description below. Would you be in a position to try to redefine capitalism? Yes. First of all, let's agree that it has to work for the majority of people. (18:00) Most people. It's got to work for at least 70% of the economy. I mean, most. And let's establish the fact that there's a level below which we shouldn't let people go. And let's also establish that society as a whole has to be productive, that it's not just giving people money. So if you keep giving people money, that's not going to be good. (18:26) We talked about that; you have to build a healthy education system and convert that into productivity. Productivity is a key word. The society as a whole has to be productive to be able to then have the income because it's not just financial income. Money just has no intrinsic value; it's what you produce. (18:54) It's got to produce, so you have to be productive as a whole. Almost everybody's got to aspire to be self-sufficient, and you have to help them get there in order to operate. So if we all agree on that, there are wonderful things that we can do to help that: invest and aspire to equal quality education or higher. (19:23) Don't lower the high levels to get equality or whatever. Aspire on how to raise the educational and security levels. In many schools right now, you have to go through a metal detector to make sure guns don't go into the schools. You have drugs. You have all of those things. You have to create an environment in which those children are raised well, have those basics, educated well, and made them productive. (20:00) We have found out... my wife through her work. Her mission is to get high school students in the worst neighborhoods who would have dropped out, through high school and into jobs. We find that that can be done for about $450 per student. And so if you do that, you realize that's cost effective. But it doesn't have to be our program. (20:29) But in one way or another, we have to define it. We have to define capitalism as also having all-in-cost. What I mean by all-in-cost is that there are costs to educating, to not educating a student, to having them drop out, to crime, and so on, or there are costs in our environment. If somebody can pollute the environment, and there's no penalty for polluting the environment, that's a cost to society. (21:08) In one way or another, for capitalism and the profit system to work, it has to be all-in-cost. But we also have to recognize that the profit system alone is a great way of allocating resources by and large because it means that whatever you're producing is worth more than whatever it cost you to produce it. (21:32) That's a good thing to have. But we also have to realize that it can divert resources from those things that we need most, like education. For example, the constitution in the United States makes education a state issue, not a federal issue, and then within each state, it's typically a tax district issue. (21:58) So if you live in a rich community, you're probably going to get more money for education than not, and then your kids will be more privileged. There's nothing wrong with educating those kids well, but in some way, you've got to make it work and engineer it. And I see it in my philanthropy. I see it. (22:23) For example, okay, here it is; we're here and COVID comes along, and the kids don't have computers. Okay, so there has to be an understanding of these basics: you need to invest in people and their productivity, and there are intolerable things that can't be done, not be done, or done in a bad way. (22:55) And you can design that. The way to design that, by the way, is not by any one person imposing what they want. We have a problem here of polarization, and all different people have different views of what they want. Now they have extreme views of what they want, and they fight and don't resolve it. I think what we need as a country is bipartisanship of moderates who are intelligent and able to do the engineering. (23:33) We should have a bipartisan president, I think; this is a dream, but there are things we can do; who has a bipartisan cabinet who brings together both sides there; moderates who agree more with each other than agree with the extremists, and then who are smart enough. And they should have something like the Manhattan Project or a constitutional convention in which there's something like a year and you bring them from the moderate left and the moderate right, who can work together and engineer a proper re-engineering
(24:18) or reforming of capitalism, how it works mechanically, and you can get there. Everything needs to be reformed; every machine, every computer, every thing, and every society needs to be reformed. And we need to reform the system so that it achieves those goals of working well for most people and making them productive, and that can be done. (24:51) I'm in complete agreement with you on polarization. It's quite pervasive; it's not just in the US; it's all across the world. And I'm totally with you on this idealism of creating some sort of bipartisan framework of decision-making. But what I'm detecting beneath that is that there is a concern with respect to the inability to find the right intersection between power and talent, irrespective of the ideology, whether it's autocracy or democracy. (25:30) I studied the 10 most powerful empires over the last 500 years and the last three reserve currencies. It took me through the rise and decline of the Dutch Empire and the guilder, the British Empire and the pound, the rise and early decline of the United States Empire and the dollar, and the decline and rise of the Chinese Empire and its currencies, as well as the rise and decline of the Spanish, German, French, Indian, Japanese, Russian, and Ottoman Empires, along with their significant conflicts as measured in this chart. (26:12) To understand China’s patterns better, I also studied the rise and fall of Chinese dynasties and their monies (dating) back to the year 600. Because looking at all these measures at once can be confusing, I’ll focus on the four most important ones: the Dutch, British, US, and Chinese. You’ll quickly notice the pattern. (26:37) Now let’s simplify the form a bit. As you can see, they transpired in overlapping cycles that lasted about 250 years, with 10 to 20-year transition periods between them. Typically, these transitions have been periods of great conflict because leading powers don’t decline without a fight. So how am I measuring an empire’s power? In this study, I used 8 metrics. (27:06) Each country’s measure of total power is derived by averaging them together. They are education, inventiveness and technology development, competitiveness in the global market, economic output, share of world trade, military strength, the power of their financial center for capital markets, and the strength of their currency as a reserve currency. (27:33) Because these powers are measurable, we can see how strong each country is now, was in the past, and whether they’re rising or declining. By examining the sequences from many countries, we can see how a typical cycle transpires. And because the wiggles can be confusing, we can simplify it a bit to focus on the pattern of cause-effect relationships that drive the rise and decline of a typical empire. (28:05) As you can see, better education typically leads to increased innovation and technology development. And with a lag, the establishment of the currency as the reserve currency. You can also see that these forces then declined in a similar order, reinforcing each other’s decline. Let’s now look at the typical sequence of events going on inside a country that produces these rises and declines. (28:34) In a nutshell, the big cycle typically begins after a major conflict; often, a war establishes the new leading power and the new world order. Because no one wants to challenge this power, a period of peace and prosperity typically follows. As people get used to this peace and prosperity, they increasingly bet on it continuing. (28:59) They borrow money to do that, which eventually leads to a financial bubble. The empire's share of trade grows, and when most transactions are conducted in its currency, it becomes a reserve currency, which leads to even more bubble. At the same time, this increased prosperity distributes wealth unevenly, so the wealth gap typically grows between the rich-haves and the poor-have-nots. (29:28) Eventually, the financial bubble bursts, which leads to the printing of money and increased internal conflict between the rich and the poor, which leads to some form of revolution to redistribute wealth. This can happen peacefully or as a civil war. While the empire struggles with this internal conflict, its power diminishes relative to external rival powers on the rise. (29:56) When a new rising power gets strong enough to compete with the dominant power that is having domestic breakdowns, external conflicts, most typically wars, take place. Out of these internal and external wars come new winners and losers. Then the winners get together to create the new world order. And the cycle begins again. (30:23) And so if we're realistic, we understand that dynamic and how it works because that dynamic has happened repeatedly through history. So you have to get to the notion: Okay, what does it matter most? Who is weak? Who is in control? It all can't be theoretical. So I think that we as a population will go toward a form of financial crisis system, civil war, and external war. (30:57) If we don't have fear of that… I have a principle: if you worry, you don't have to worry. And if you don't worry, you need to worry. Because if you worry, you will take care of what you're worrying about and chances of happening are reduced. And if you don't worry, you'll headlong into it. (31:19) I think we're not worrying enough about these things. And only if we recognize that we have to pull together and that there's a strong middle, there needs to be a strong middle, and we pull together and we're not so hung up on exactly how we do it, just as long as let's agree on how to do it and work there so that we can do it. And there's no other path. (31:46) I sense that the world is not worried enough. And what would it take for anybody across the world to be more worried in the context of the five forces that you've been talking about: indebtedness, internal conflicts, external conflicts, climate change, technological change, and all that? It just seems that nobody's worried enough about any of these. (32:13) It's because we've never experienced it before in our lives. What's happening now is one of those things that comes along once every 7500 years kind of thing. And we only react to it. So we each go into our happy worlds. Let’s think of our experience: you go into your neighborhood, I don't know, we go out to dinner, go to ball games, they watch their streaming of this and whatever, and there's not the experience. (32:52) And it seems so... Why worry about it? I mean, everybody's talking about it, but I'm not experiencing it. The only way we learn is through experiences and sometimes the pain that they produce. And so we haven't had this. It comes along once the new world order began after the last great fight. The war. (33:20) Okay? You have the war; you have the pain of the war; you have the restructuring; you establish who the power is; nobody wants war again; you take that generation, my parents generation, who lived through the Depression and war, and they come out and they have learned, okay? They have learned to save, they have learned to not get into war, and that learning and establishing who's in control sets the stage for the prosperity that comes that then we produce these greater wealth gaps, a sense of unfairness, and debt bubbles. (34:07) And we do the same thing again; you have a debt bubble crisis, and so on. So if you can get them to intellectually worry, and that's one of the things I'm trying to pass this thought along. If you're worried you pass that along, but sometimes it's going to take experiences, and then it's going to take figuring out how to engineer it so that you get through it. (34:33) So you have to have agreement from smart, reasonable people about what to do. That's just how reality works. Bridgewater has done excellently over the past few decades. I would speculate that it's mainly because you've been the great Chief Worry Officer of Bridgewater. Now, would it help? I mean, would you advise anybody out there, be it in a household, in a school, in an office, in any social institution, as for them to have some sort of Chief Worry Officer so that the world will be better off going forward? (35:13) I don't know. I think the world is (full of) worry and opportunity, and then knowing how to go after the opportunity while minimizing the downside. And I learned how to do that through my painful experience. If you want, I could tell you about it. But anyway, through this painful experience of being painfully wrong, I learned humility, and I wanted to find the smartest people who would disagree with me to stress test me and also for me to learn. (35:56) And I also learned how diversification of my bets could reduce my risk by up to 80% without reducing my returns. So I think people have got to learn those things. They have to learn how they can have great upside with opportunity while virtually eliminating the unacceptable downside. So you have to learn that through experiences and so on. (36:36) I think experience is the best teacher. My dad learned it because he went through Depression and war. He didn't earn much money; he was a jazz musician. He raised me. I went to great school. He had everything that he needed. We had everything we needed: a nice house- not a mansion, of course, but a nice house-food; I went to public school; we had a car. (37:03) Everything that he needed. And when he died, when he was 91, he had over a million dollars saved up, and that's a while ago, so that's a few million dollars. And he had a great life, and he learned it because you can do that. You have to give up overindulgence, let's call it, and you do that. So in each of our own ways, we can learn it, perhaps through experiment.
(37:38) Of course, we want to do it intellectually, but... So I don't know that… The real question is: is the person in charge like that? You have a Chief Worry Officer; it's good. Yeah, companies have risk officers; it's a good thing to surface those risks and also know that it's only one in 20 years or one in 30 years that'll kill you. (38:05) Like, all companies die. When I decided that I was going to run Bridgewater, I did certain things to make sure that it couldn't die. It can [inaudible] because... but we would not go broke. And so, yes, that worrying is good. I don't know about… But you have to have it in your bones and in your leadership while you're also excited about the opportunities. (38:29) I mean, Bridgewater was amazing- a two-bedroom apartment, 1,500 people, and we made more money for clients than any hedge fund ever in existence. They made money, and we made money. We have a community. It's built around meaningful work and meaningful relationships. It was great. But there is a way of doing that balancing, and you have to know it and want it through experience, I think. (39:00) Yeah, you've done really well, man. I mean, you've made money in what? 28 out of the last 30 years or something like that. It's awesome. Yeah. Because I don't want to lose money. And we made great money. And yeah, we made more money for the investors than any other, so yeah. You're one of the earliest observers of China. (39:25) You've done business there, and you've interacted with so many personalities out there. I want to talk about the current US-China relations. And I want to put this in the context of what you've alluded to a few times in the context of the 100-year storm in horizon. Talk about that. Yeah. I've been very lucky. (39:52) In 1984, I was invited over by CITIC, which was called the “window company”. It was the only company that was allowed to deal with the outside world. In 1978, Deng Xiaoping came to power, and he wanted to have an open-door policy and great reforms, so I went there. And I went there out of curiosity. They didn't have any money; they couldn't pay me anything. (40:22) And I went there out of curiosity. And I started to develop these wonderful relationships with these wonderful people about helping them develop their system, their capitalism, or so on, for a long (time). And we've been long old friends over a long period of time. It was something like 12 or 15 years. (40:45) I was there before I ever earned any money, and it was the satisfaction of that relationship. And that's continued to today. I studied the dynasties, and I've had the experiences. Since I started going, China's per capita income has increased by 28 times, life expectancy has increased by 10 years on average, a poverty rate went from 88% to less than 1%, the greatest economic transformation of all time, and there's a great understanding of history. (41:24) That's why Xi Jinping says that there's a great storm on the horizon, a one-in-100-year storm on the horizon. And that storm that we're facing- we're all facing it in the world. In the United States, we're talking about it; the same cycle I talked about with a combination of debt, wealth gaps, and international conflict. (41:54) Okay, that storm. There's a great storm on the horizon. And then there's the reaction of how do you deal with that great storm. There's internal conflict, and there's external conflict. So what's happening in China now is largely what always happens in such periods of great conflict, and they know it; they've seen it through their dynasties that everybody must line up and be... (42:28) There's no room for fighting between ourselves. There's one side, and everybody must line up and be on that side, and if there's any wavering, “Okay, off with your head,” or something like, “You have to deal with that.” That's something, by the way, we're dealing with in the United States and democracies in their own ways and histories. (42:54) You have to look at history, and when you go through those periods, even the most democratic countries, you cannot say a lot of things. You can't do anything; you have to line up and follow. And so we're doing that while there are these classic things we're fighting over. So for example, in World War II, when we had world deppression, there was a conflict, let's say, in Japan. (43:23) By way of example, it happened with Germany in Europe and Japan in Asia. There's this conflict, the geopolitical conflict. In the geopolitical conflict, the United States cuts off oil to Japan and also freezes their assets. And when they freeze their assets, that leads to Pearl Harbor. The same dynamic is going on; chips are now oil. (43:59) And so that's the dynamic. There's a fear in China and other countries that they might get sanctioned by the United States, meaning if you had dollar assets in Japan, the world, or Russia, they would make them worthless. That particular dynamic is sort of happening again. And so that's where we are. (44:26) We have a number of issues that are irreconcilable differences. So we're at the red lines on a number of those issues. I could touch on them briefly, but there's obviously the Taiwan issue; go to the history of Taiwan. Okay, we're going to go back. There's what's called the “hundred years of humiliation”. (44:52) The west and China lived in two largely different worlds that then came together when the foreign powers, particularly the British, came into China and wanted to trade, and China said it had all its needs and didn't want to trade. But they want to force themselves in; they create the Opium Wars. This started in 1840. (45:22) And they create the Opium Wars to sell opium to get that and whatever. And then they have military conflict, and different foreign powers take different parts of China. Japan took Taiwan in 1895. Fast forward, you go to the end of World War II: Japan loses the war, the new powers win to find who gets what territories, and China is given back Taiwan.
(45:58) And so everybody agrees that Taiwan is now reincorporated into China. But China has a civil war between, again, the left and the right, the Communists and the capitalists. You have this war. The capitalists run to Taiwan. And so there's an argument over who controls Taiwan. But there's one China, and it's an internal civil war. (46:26) 50 years later… Excuse me, 50 years ago, Henry Kissinger goes and everybody agreed China's part of Taiwan. Now we have the possibility; there's a question, supposed to be peaceful reunification. Over time, 50 years later, it would be considered a declaration of war if the United States said that Taiwan would be an independent country. (46:59) That would be intolerable. But there's the pushing of the edge of that, which means that in favor of the defense of Taiwan, the United States will act in favor of the defense of Taiwan, send military equipment, and so on. And so that's one example of something that is right at the edge and is kind of an uncompromisable and difficult situation. (47:30) If you take a number of the issues, like if I take the issue of support for Russia in the war here, it's a big issue. If I take chips, if I take trade, if I take many things, we are at those lines, and therefore we have this great power conflict. Wow. You know, in the seeming trap between China and the US, what would be your views with respect to Southeast Asia? Do you think this is more of a threat or an opportunity for Southeast Asia? Before I answer Southeast Asia, I want to emphasize that in that struggle, (48:27) there will not be a winner or a loser, but the ultimate winner is going to be that conflict, which will all depend on how strong the country is internally. Got it. It will depend on how financially strong it is, how productive it is, and how people deal with each other internally to be strong. So both of those countries are going to struggle with each other, but their main struggle is an internal strength struggle, and that will determine how the external conflict goes, I think. (49:13) And to answer your question, it's an opportunity more than a risk. I'll give you the history. Neutral countries: In wars, there're winners, there're losers, and there're neutral countries. Neutral countries do better than the winning countries in wars because the winning countries get into debt, like when the British won the war but went bankrupt. (49:47) The United States made a lot of money because it entered the wars late, so all the gold that it accumulated... Gold was money at the time. The United States accumulated 80% of the world's gold because it entered both World War I and World War II late. So neutral countries that don't get into war… The three big ingredients for a country are: do you earn more than you spend, so you have a good income statement of balance sheet? Do you have an internal dynamic that is destructive or productive? And are you in an international war? (50:29) And so, when I look at the emergence of countries in the ASEAN region of the nature of how Indonesia, Vietnam, and the Philippines, other those countries. They're coming up with higher rates of capital formation. They are operating in a way that's going to be more productive. They are… If they remain largely neutral and can avoid being in that war and that. (51:09) They will do well. Singapore is emerging as almost Switzerland kind of capital for various reasons. And so that is an area of opportunity. India also benefits from this because you also see that companies don't want to be in China because of the nature of the whole war situation. Not just military war, but let's say economic war, and they're worried about that. (51:44) Then they go to these other countries. And then they benefit; capital goes, business opportunities go, and so on. That's also, by the way, happening in the Gulf countries in the Middle East to some extent. So it is by and large a benefit if those three ingredients remain in place. Those three ingredients: earn more than you spend, have a good income statement balance sheet, work well together, eliminate corruption or minimize it, create capital formation, and create opportunity. (52:27) And then number three: don't get into the war. That's great advice. I'm going to push on this, Ray. In the context of the need to spend less than you make, the need to borrow less than you make, and the need to be more productive than you make, between China and the US, who's likely to be more competitive in the next few decades in the context of all those? The United States has a very unstructured creativity that also with its capital markets and adaptability, is able to invent very quickly. (53:22) It doesn't make a strategic plan; it doesn't have the... it's very much a bottom-up type of approach that also does create the problems that we're talking about about the large wealth and opportunity gaps and those types of things. And when Plato… This dynamic and question have gone back a long time; democracies existed for a long time. (53:51) Plato wrote ‘The Republic’ and he made the point that there are cycles, and what happens is that the greatest risk to a democracy is anarchy due to the internal fighting creating disruption, and so on. So the United States has those advantages and has that challenge about that internal fighting and how that works and gets through it. (54:20) Then you go to China, and it is now dealing in a much more autocratic, top-down-directed kind of way. So, that will direct resources in many cases to producing, like in a war economy, the things that are going to be needed. In other words, in many cases, how does a war economy work? You don't have a free market operating in that economy because of the profit system. (55:07) People going and spending a lot of money on expensive handbags are not going to be productive in a war economy; it's just not going to work. So you have that sort of directed, but that directed is going to be less corrected, but it's going to be very focused, and you won't have people fighting each other in the same way as long as you keep that.
(55:31) And so you see that kind of approach. Those are the differences in the approach. Both of them have their vulnerabilities, so as we go through that, I think one can't easily say one side is going to win over the other. Each has their vulnerabilities, and each has their advantages. So I'm not going to pronounce it. (56:06) It's all a function of your circumstances. There comes a time where everybody lines up doing what they're told to do: go fight the war, and all that is an advantage. And there are times where that kind of thing is a disadvantage because top-down leadership and all the decisions have to go to the leader, and everybody's fearful, and because they're fearful, they won't make decisions, and that has problems. (56:38) So it looks like that to me. I don't think we should worry about pronouncing a winner; we just have to know that there's going to be a conflict along those lines, as there always has been. Got it. Ray, one of the five great forces you've alluded to earlier is climate change, right? And I've been alluding to the fact that the sustainability narrative resonates with only a small portion of the world population, whereas most of the world population is more concerned about putting food on the table, (57:19) irrespective of how the energy is sourced. In your view, how do you think we could help reconcile these two seemingly irreconcilable narratives; the narrative of development and the narrative of sustainability? I don't know that I have the answers to all the world's problems. So let me just describe what I think is the reality of what is going on. (57:52) We have a situation where, as you point out, one of the five great forces throughout history has been acts of nature; droughts, floods, and pandemics have killed more people than wars, caused more governments and geopolitical systems to collapse, and so on. And it's a huge deal right now, however you deal with it. (58:22) If you don't deal with it, it's a huge deal. If you deal with it, it's a huge deal; it's going to be costly. There are three types of costs for that. There's the cost of going from, let's call it, brown energy to green energy, which is very costly. You have to invent the energy, you have to re-adapt. (58:45) And in that period of time, there's a gap in not investing in brown energy. And so there's a supply-demand issue, and it becomes costly. The second cost is the building of infrastructure to deal with climate change. Literally, in Indonesia, it's an issue for Jakarta to others, so you have to build infrastructure. (59:17) How do you deal with the infrastructure that's costly? And then there will certainly be damages; droughts, floods, all of those will have damages. And the estimated cost of these things in one way or another, however you spend it, is in the vicinity of $10 trillion a year, depending on how you do it. Let's go up five to 10 trillion dollars a year. (59:44) World GDP is a hundred trillion dollars a year. So 5 to 10% of GDP is going to be this cost that is going to come on top of the other costs, okay? So let's first realize that. Let's digest that. How are we going to deal with that? Then, as you point out, there's the developed world and the emerging world. (1:00:16) And the emerging world has a larger population, and is poor, and in many cases, is not efficient in many countries that are corrupt, and so on. So how do you get resources or affect change in the underdeveloped world? First, where does the money come from? Where's the motivation come from? How do you get through the corruption and so on? Well, there are no easy answers to these things, right? The only answer to all of this is when the greater good rises above the individual good as the priority. (1:01:20) And then it becomes a common problem. So how do you get the resources and so on? You know, during such times, the opposite is true. I'm going to fight for me, and we'll line up and fight for us. So I think it's going to be an intractable problem. Claudia, I’m going to be interviewing Ray Dalio next week. (1:01:57) I know you’re a big fan of his. Any questions you want me to ask him? Yeah, wow! I really like Ray Dalio; I’m a huge fan. Actually, I do (have a question). I’m thinking, what would Ray Dalio tell my 5-year-old daughter if I had one about the next 10 to 20 years of her life? What should she expect? What should she think about? - I'll question that to him. - Thank you, sir. (1:02:28) Very excited for your time with Ray Dalio. - Tell me how it is. - I’ll let you know. Thanks. What would Ray Dalio advise a 10-year-old kid anywhere in the world in terms of what he or she needs to push forward in the future? I'm going to give you the longer answer again. There are three phases in life, I think. (1:02:57) There's the first phase in life where you're dependent on others; you're being raised, you're going to school, and at 10 years old, you haven't yet transpired into puberty; it's just part of puberty. And you're learning in a unique way that actually the mind-brain changes out of puberty in a way that you're having experiential learning, you haven't yet had the rebellion for your parents, and so on.
Recommendation list svp, not in particular order: Stephen Fry (the most eloquent I've ever heard) Yuval Noah Hariri Morgan Housel Jeremy Grantham Nassim Thaleb? (Too cynical perhaps) Cliff Asness (that's my fave😅) Dr. Siddharta Mukherjee Dr. Henry Marsh Prof. Sean Carroll Prof. Brian Cox Malcolm Gladwell Daniel Goleman Daniel Pink Burton G. Malkiel Cass Sustein Richard Thaler Robert Shiller David Rubenstein .....🙏🙏🙏
Kudos to Pak Gita Wirjawan for orchestrating such an incredible episode with Ray Dalio on the podcast! It's not every day you get to witness two titans of finance engage in meaningful conversation. Pak Gita, your ability to bring thought leaders like Ray Dalio to your show is truly commendable. The insights and knowledge shared in this episode are priceless. Thank you for making this happen, and please keep up the fantastic work. Looking forward to more outstanding content like this!
Never had I imagined that one day Ray Dalio himself would be speaking in an Indonesian Podcast. I must say that we, the people of Indonesia, are very proud and thankful for your efforts to open a lot of doors of knowledge for us.
Watching here from Malaysia, Kudos to you and thanks for the content 🫶🏻
THE CONVERSATION WITH RAY DALIO
Up Close & Personal
01:50 - Family background
04:53 - A different Ray
Consumerism & Inequality
06:51 - Time preference of different generations
11:29 - Current societal challenges to nurture low-time preference
New Age of Capitalism
17:27 - The updated version of capitalism has to :
1. Work for the majority of people.
2. Support productivity for the society as a whole.
3. Internalize externalities, including environmental and societal externalities.
4. Reform the governmental system to reconcile polarization.
Breaking the Historical Cycle
24:25 - Gita raises his point on the possible cause of polarization : The lack of talent in the people who are in power.
31:46 - The world lacks of concerns about things that matter because the impacts have never happened in our lifetime - and that’s where studying history comes in.
34:43 - Minimizing risk in grabbing opportunity : Lessons from Bridgewater.
Storm in the Horizon
39:20 - World’s 100-year cycle.
48:01 - Is this 100-year cycle an opportunity or threat to Southeast Asia?
US-China Outlook
52:32 - US democratic turmoil vs China’s autocratic journey.
Climate Crisis
56:53 - Gita raises the paradox of sustainability: Renewability vs modernity.
57:52 - Three costs of climate crisis:
1. Brown to green energy transition.
2. Infrastructure to adapt to climate change.
3. Damages due to the climate change.
1:00:10 - How do we get underdeveloped and emerging countries to take part in this issue?
Eudaimonia
1:01:42 - Ray’s advice for a 10 years-old
1:07:54 - What makes Ray happy?
Selengkapnya di : sgpp.me/eps158notes
Great Resume
thank you
wah Pak Gita kereeenn, tujuan mulia mu untuk ingin lebih membuat Bangsa ini lebih mature secara pengetahuan dan cara berfikir emang terasa sekali, thank you Pak Git!
Gila, keren sekali narasumbernya! Terima kasih banyak Pak Gita Wirjawan sudah menghadirkan Ray Dalio ke EndGame. Senang sekali rasanya bisa belajar dan menyimak percapakan ini.
Dua orang hebat ini sangat menginspirasi, semua kata2 yang keluar sangat berbobot. Indonesia bangga punya Pak Gita. 👍🏿
Channel youtube paling sangar se Asia tenggara! Semoga setelah ini pak Gita bisa podcast bareng Jack Ma, Warren Buffett, atau mungkin Elon Musk🎉
Harus elon musk
terima kasih pak gita sudah mendatangkan narasumber yang Luar biasa, sangan mencerahkan
Luar biasa pak Gita bisa mendatangkan Ray Dalio di podcast ini. Awesome achievement pak Gita and team!
Suatu kehormatan bagi saya karena mendapatkan ilmu dan wawasan tambahan yang sangat berharga dari Mr. Ray Dalio. Terima kasih banyak Pak Gita sudah mengundangnya di endgame. 🙏
Terima kasih Pak Gita sudah mendatangkan Ray Dalio 🙏
Tank You so much to Mr Ray Dalio, Mr Gita Wiryawan. You are very Inspiring Generation today...
Amazing Person in the world....
God Bless You All...
Ray Dalio is genius teacher, I teach my little boy about economic refer to Ray's cartoon in UA-cam.
His explanation very eazy to be understood.
gilaaa narasumbernya bukan main-main, terimakasih pak gita yang sudah undang Rai Daliyo untuk bincang-bincang
Glad you invited notable hedge fund manager Pak, and not to mention the conversation also conducted clearly. Thanks!
Thank you so much Pak Gita for presenting this wonderful podcast with the wonderful Ray Dalio. Thank you so much Ray, for your books and animations that help a common person like me to understand economy easier.
Luar biasa, Pak Gita membukakan pikiran, pendapat Ray Dalio ke publik Indonesia.
Terima kasih
Its so amazing, Terimakasih Pak Gita Buat Percakapan 1 jam 10 menit yang sangat menarik untuk diikuti tiap detailnya, saya juga penggemar dari Ray Dalio jadi jika ada yang mewawancarainya itu sangat membuat saya bahagia, Indonesia beruntung punya orang seperti anda pak Gita, Sekali lagi saya bertrimakasih, semoga bapak sehat selalu dan semakin diberikan kebijaksanaan.🤗
OMG, NEVER EXPECTED YOU TO INTERVIEWING RAY DALIO IM A FANS OF BOTH OF YOU!
Love u Ray
always love your "age of empire" content :)
thanks Mr Gita and Team for invite this maestro :)
Sejauh ini, inilah podcast youtube yg paling jauh sih, thaNk you pak gita bikin kita melek cara pemikiran orang2 crazy rich tentang menasihati cucu2nya..❤
Keren banget sih bisa wawancara sekelas Elite Global yang juga idola gw dibidang investing & financial Ray Dalio 😂
GG Pak Gita!
Trima kasih Pak Gita udah menghadirkan Ray Dalio, seneng sekali bisa menghadirkan beliau trutama dengan buku nya yg banyak jadi perhatian dan menarik sekali tentang the world order. thanks pak.
Waahhhh.. ini sih pembahasannya ga cukup ditonton cuma 1x. Save dulu ah biar bisa dikunyah berkali & meresap ilmunya. Thank you Pa Gita for sharing
Dapet ilmu lagi disini perbincangan 2 tokoh yg saya idolakan ,terima kasih pak channelnya sangat menginspirasi dan mendapatkan manfaat banyak 🙏
Dahsyat ... Salah satu honored person yg sangat ingin saya ketahui isi kepalanya ... Thanks Pak Gita
In 2023, American investor and author Ray Dalio participated in a discussion at the Ubud Writers and Readers Festival, focusing on the theme of "Past, Present, and Future." During the conversation, Dalio reflected on his upbringing, crediting his parents' love and early involvement in the stock market as shaping his financial journey. He emphasized the importance of financial education, advocating for prudent financial practices like saving and investing.
Dalio also delved into the rise and decline of empires, pointing out the critical roles of education, innovation, and the establishment of a reserve currency in these historical processes. Additionally, he discussed the potential global conflicts and opportunities in Southeast Asia, emphasizing the region's ability to thrive by avoiding war and fostering productivity.
Amazing Pa Gita speak with Ray Dalio... Two Thumbs Up 👍👍
Org dari keluarga miskin harus berjuang utk mencapai kemajuaan utk keluarganya serta saudaranya..semangat berjuang menata menejemen keuangannya supaya keluarga terangkat ke tingkat yg lebih baik atas bimbingan ayah dan ibu memberi semangat berdasar❤❤
Gila keren bgt ray dalio asli nih panutanku,keren pak gita bisa undang beliau
Ini pembicaraan yang sangat sangat sangat berharga, bagaimana orang belajar, bagaimana suatu masyarakat belajar menuju masyarakat sejahtera, coba refleksikan dg situasi indonesia dari awal pembangunan 70 an sampai sekarang, menciptakan ribuan lembaga pendidikan dan hanya menghasilkan kertas berharga yg disebut ijazah bukan product yg bernilai berguna utk pasar dunia.
Channel UA-cam terbaik di indo, tamunya bukan lokal , global juga penulis2 hebat . Bisnis, psikologi, sosial, politik , ekonomi, spiritual, islamis dll. kishore mahbubani ada, John Mearsheimer, yoval noah, ray, sadhguru ,aduh sampe bingung . kelihatan sekali kalau youtuber yang banyak membaca + kemampuan menjangkau relasi hebat ... sangat membantu masyarakat.
gak ecek-ecek , top dah.
Manfaatnya hampir sama kayak membaca buku,.
Semoga berikutnya ada "nouriel roubini".
(Penuh harap) penasaran dengan ucapan nouriel karena menulis buku "megathreats"❤❤❤.
Sehat selalu pak gita .
I’ve been at time machine when hear this conversation, much more lesson and learning about past, present, and future.
All about the end game things is on a lot of value to takes to get more productivity in our life cycle with balancing the kindness, peaces and takes the opportunity smarter enough. I’m a millenial and thanks for this quality meditate
We are very proud of you Pak Gita & Team. It's an Amazing podcast! :"
Hey bro no lie this is one of the best Ray dalio interview I've seen. Great job
The interview is nice serious and at the same time relaxed.
The interviewed is awesome, what lucky are these grandkids!!!!
who wouldnt like having a dad ora grandfather like him?
God bless him
Terima kasih Rai Daliyo, terima kasih Pak Gita dan semua yang mendukung terlaksananya sesi ini. Benar-benar banyak pelajaran berharga.
Thank you Mr Gita & Mr Roy a wise dialogue to be a perspective for developing personal strategies during this era, especially as individuals to keep track of how capitalism works and be innovative and use all the potential around for productivity and a unique way with the self passion, really enjoying this episode
Semoga ada event ray dalio di indonesia..salah satu ekonom favorit sya..yg omongannya A ya A, B ya B..
Love from Australia on the best interview of a hero of mine. Gita, you are a discovery for me and your intelligence, knowledge and humility comes across in the interview. Well done.
Halo pak GITA, saya NUR AINI, warga negara Indonesia, yang sekarang berada di Penang Malaysia, saya sering nonton acara bapak di UA-cam, tetapi yang tidak saya suka iklan nya selalu, iklan Malaysia, bukan saya benci dengan negara Malaysia, tetapi karena saya warga negara Indonesia, saya sangat bangga, apapun itu tentang negara saya yaitu Indonesia, karena sayang menganggap UA-cam, adalah pengganti televisi, jadi saya suka melihat berita berita, bagaimana perkembangan republik Indonesia, semuanya dari Sabang sampai Merauke
Thank you Gita and Ray! You did an excellent job interviewing Ray, much better than the American youtubers I've seen, thank you for this.
Ray Dalio is the best 👍
wahh keren parahh
bisa mengundang Ray dalio utk podcast, terbaikk
Pak Gita sy salute dg circle anda
Wow. Great episode. Thanks Pak Gita.
Keceeeee banget Pluang sponsoring this vid!! Good catch 🔥🔥😎😎 very insightful content
Splendid interview. I wish politicians of countries would listen to him and consider changes...the world could be a better place.
Never
I've speculated before pressing this vid that i think i'll get a lot out of it, and ii was right! Thankss so muchhh Pak Gita 🙏
Every single watch Mr GW's content, felt that what we r doin isnt enough, coz our developing country needs more effort & willipower..
Endgame semakin lama semakin cool dan Badas karena banyak menghadirkan narasumber yang tidak bisa di undang oleh channel UA-cam indo yang lain .
Narsum nya sekelas Ray Dalio njir GG banget Pak Gita
terima kasih Pak Gita sudah membuat Podcast dengan Mr. Ray Dalio, salute!
bagus banget ini episode... aslii dahh..
Terimakasih Pak Gita, Ray Dalio, dan Endgame Team👍🙏
oh c'mon this meaningful convos deserves more than 100K++ viewers ...
I support 100% Gita Wirjawan become president of Indonesia 🇮🇩 ♥️
WOOWWW!!! WOOOWWW!! Salut Pak Gita Wirjawan!!🎉🎉🎉😊😊😊
Thank you so much Pak Gita for this podcast, kinda open our eyes & make us understand about the situation in the world right now. But who decide everythings are the world's leaders, not regular people.
They should think every human being has a right to live in freedom, wealth & equality. War just make people suffer.
The collaboration we didn't know we needed 😍
Gita is a legend for inviting Ray Dalio.
Peperangan itulah yg menyengsarakan umat manusia di dunia ini..semua keno dampak perekonomian di dunia ini terjd di semua negara di bumi ini😢😢
I am late for watching this podcast. Ray Dalio is one of my guides in stock investment.
Ray Dalio for president!
Invaluable pearls of wisdom
Keren sekali bintang tamunya!!! Next Warren Buffet 👍🏻🙏🏻
Super impressive mr Gita 👏 one of the most clever person in Indonesia
merinding banget, keren pak Gita ngobrol bareng Ray Dalio
Bapak tolong undang Kak Ars-Vita pak, beliau akan sangat mengedukasi dalam bidang IT :), Terimakasih
wow.. ray dalio...thank Pak Gita
I always amaze with your guest speakers 😊
Holy moly! It's Ray.
Masha Allah pak Gita amazing sekali bisa bikin content dengan pak Ray. Terimakasih banyak atas kontennya pak 🙏
Simply amazing!
Keren banget, pak Gita,,, saya nunggu next nya dengan michael saylor, CEO microstratregy
coincidence? Lately I've been watching UA-cam and Raydalio's book for evulation and reading e-books. I can chat with Mr. Gita, have a fun discussion, joke around, can my intuition and intuition tell me the future?
NARASUMBERNYAAA GOKIL, terimakasih banyak pak Gita dan END GAME TEAM..
Beautiful!
My Idol.. Ray Dalio
Pak, ajak discussion capres2 untuk tambahan input kita dalam menentukan pilihan, biar endgame nya cocok
Great mentor 🙏🏼🙏🏼 RAY DALIO
thank pak gita with this podcast....with legend Ray D... banyk sudah ilmu yg disadap dari podcast engem....thaks Sir....wishng good health & happnes For u Sirrr....
Such A Great Podcast...
Such an iconic voice of him. Ray Dalio's voice is on the level of Morgan Freeman's.
Mantap pak gita sama ray dalio suka bet gw sama doi
My idol, thanks mr gita!
mantap pak Gita, bisa ngundang salah satu greate investor 👍
Wow this host is incredibly good!!
Impressive, even in his seventies, he remain productive, possess a sharp mind, and pursue a fairly extreme new hobby.
Keren pak Gita
I think when we are in a scope with a bad connotation, it doesn't mean it's always bad, because in their case it's the past they grew up in and the habits of their environment were created, and as future generations we need to invite positive activities that build a positive environment is a problem solving ,thank you pak gita its a great room discuss
Wuih gilaa, mantabb banget tamunya pak gita 🙏
buset dimana lagi kalian nonton ray dalio di podcast indo selain di end game ini?
Nice...
Next, semoga Pak Gita bisa eksplore konflik Palestina Israel dgn narsum yang independen..
Seperti biasa selalu sangat berbobot content nya pak Gita
(1047) Ray Dalio - Pola Lahirnya Adidaya Ekonomi | Endgame #158 (Luminaries) | UWRF2023 - UA-cam
ua-cam.com/video/f5xkLvq-MUw/v-deo.html
Transcript:
(01:02) Welcome to this year’s special collaboration between Endgame and the Ubud Writers and Readers Festival. The theme of this year’s festival is 'Past, Present, and Future'. This year’s guest is American investor and author of “Principles for Dealing with the Changing World Order”, Ray Dalio. The aim of this discussion is to explore and reconcile the idealism versus the realism of the future world.
(01:28) Enjoy this episode. Hi Ray, thank you so much for gracing our podcast. It's so good to be here. Thank you for having me. I know you've written so many successful books, and we in Southeast Asia are very keen on a number of things that you could shed wisdom upon all of us in Southeast Asia. But I want to explore a little bit about what values that you were brought up with that made you the the famous Ray Dalio, who I think can share a lot of wisdom to the rest of the world.
(02:03) Well, I was lucky to have two parents who loved me. My dad was a jazz musician, and my mom was sort of a stay-at-home mom. And I don't know why, but I got into doing work such as delivering newspapers and so on as a kid and earning money. And then, when I was 12, I was caddying, and the stock market was hot.
(02:34) And so I got... I didn't know what I was doing, but I got involved in the stock market. I remember the first stock I bought, which was the only company that I ever heard of that was selling for less than $5 a share, and I figured, “Well, if it's less than $5 a year, I can buy more shares, so if it goes up, I'll make more money,” which was a stupid idea.
(02:59) But what happened is that I got lucky; a company came along and acquired this company that was about to go bankrupt, and it tripled. And I thought this game was easy. The game is not easy, but I got hooked on the game. That had an effect. But mostly, I would say having good parents. My dad was a hardworking, you know, the classic; he went through the Depression and the war and was a jazz musician and hardworking but also creative; not a highly structured guy.
(03:39) My mom loved me a lot. I didn't like school. That was a frustration for them. But anyway, that was kind of the background. I grew up in an era of almost unbounded optimism. Kennedy was president, the United States wanted to go to the moon, eliminate poverty-all of those things. I believed I could almost do anything, and I came out to a world of equal opportunity.
(04:16) So I didn't like high school. I got into a college that worked very well for me, but not a great college in classic measurements, on probation. I loved college, did very well, and went on to Harvard Business School, which I loved. And I was in that world of equal opportunity. So that's kind of the summary.
(04:49) You've talked a lot about those in your principal book. But I'm just curious as to whether or not you would have turned out the way you are if you had been born at a different time in a different country. I mean, you're the true manifestation of the American dream, right? But would we be able to see the same Ray Dalio if Ray had been born at a different time or in a different country? I think that… If you look at immigrants, it depends on what I was like; it depends on how and in what ways it was different.
(05:28) But when I look at immigrants and how they get around their obstacles, and they're not having much and they have to survive and find the way, I think that that builds strengths and that those strengths and aspirations in combination drive you to what your passions are. And I think when you asked that question, I think I would have had a greater chance of that than if I was born into a rich family.
(06:14) If I was born into a rich family in the United States and I had lots of privileges, I suspect I wouldn't have had the same drive. I strived to make… learned how to make money by working at an early age. If I didn't have those kinds of things, I think that would have caused me to be a different type of person, a more different type of person than if I went to another country.
(06:51) Interesting. I want to talk about the current generation and compare that with your generation. You were born in the late 1940s. You've talked a lot about how important it is to spend less than you make. We're sort of living in an era where I think the current generation or the young generation is having a tough time deferring gratification.
(07:21) What sort of advice would you have for the current generation or the young generation? There's this notion that there's this high time preference; there's not a whole lot of sense for low time preference. They want to get this instant gratification today and do not want to defer gratification until a future date.
(07:42) Well, I'm just going to tell you how reality works. There are things that really, really matter, and there are things that don't matter a lot in your priorities. If you keep indulging yourself to consume and don't build savings, you are spending on luxuries now in exchange for great pain later.
(08:21) You have to be self-sufficient, I don't care whether that's at a high level of income and a high level of spending or a low level of income and a low level of spending; that's an individual choice of what kind of life they want to live. But if you're not earning more than you are spending, you will be dependent on others, and you will be vulnerable and experience a terrible time when you can't get ahead of that money.
(09:00) I mean, if you spend more than you earn and borrow money to do it, when you pay it back, that's going to be bad. If you still spend more than you earn because somebody gives it to you, you're going to be dependent on them giving it to you. The only way that you're going to get freedom and health is by earning more than you spend and building that.
(09:28) I used to calculate at first how many days, weeks, months, and years I could live if money didn't come in. And I would feel good. The only time I felt security was when I could live for an extended period of time, which gave me a sense of having both freedom and security. So don't waste it. I give my kids and my grandkids gifts sometimes, but I give them a gold coin as a gift.
(10:15) And then I'll give them another little gift, maybe a toy or something. And I told them, “You're never to spend that coin through your life unless there's a real emergency. And hopefully, throughout your life, you'll never have a need for spending those coins that you're accumulating. And when you get an income, you put the gold coin, you buy another gold coin, you give it to your children, you pass it along, and the day will come when you're going to have that.
(10:53) ” And what they're experiencing, the children and the grandchildren, is that they're developing a treasure. Most of the other stuff is junk; they buy something, a year or two, or whatever it's gone. So I'm saying that it's in your interest to prioritize to have a more austere and secure capability that will give you power and independence.
(11:29) How more difficult is it to get that sort of wisdom in a household in a world where, as you've aptly pointed out many times, values are diverging and wealth is diverging at a bigger rate than we might have ever seen in the past in the last few decades? And how does social media affect the ability or inability to share that sort of wisdom for you to save for the future? Well, there are a number of things that come to mind in response to your question.
(12:22) Everybody will learn through their experiences. When you learn through your mind and you're taught things, it's intellectual learning; it's not going to stay with you; you need visceral learning through your experiences. So we'll all learn through experience. Then we have a problem in what do different people learn in their environments.
(12:50) And we're talking about that because, like I said, if I didn't have an environment that taught me the things I taught, like the need to work hard and all that, I wouldn't have learned it. And so, with large wealth gaps, one of the real problems of the situation that has always been through all cycles of problems is that as one earns a lot of money or enough money, then they take care of their children in a privileged way and whatever, and the children may not have to aspire.
(13:35) And so, you see that rich people sort of get unfair advantages, and they are also not getting some of those strengths. And you see the poor people... I see this a lot; we work, my wife and I, but particularly my wife, in the poorest school districts in Connecticut, where there's poverty and all sorts of terrible environments, and in that environment, they learn differently because there's drugs, there's crime, there's gangs, and there's a problem in the school systems of being educated well.
(14:26) We live in Greenwich, Connecticut. The average amount spent per student in high school a few years ago, so it's not up-to-date, was $24,000. In Bridgeport, Connecticut, which is a poor school district right up the road, it's $14,000 per student. So there's less money being put into that school district.
(14:54) They need more because of the basics, like they don't have computers. And when we had COVID, they're supposed to learn on computers, but 60,000 students in Connecticut did not have computers because the families couldn't afford them; they didn't have it as part of their education system, and society would not provide that.
(15:16) We bought those computers philanthropically to give them that. And when you have environments in which that is the environment, then you learn that your community is your gangs, literally; your income is dealing drugs; and your path is crime that causes incarceration. That's enormously expensive. In the state of Connecticut it's like $700 million a year because of that type of cycle.
(15:51) And so they learn different things. That's just the mechanics of what we're dealing with. And unless we somehow as a society recognize that broad-based, you can't have a living standard below which people can't go, they deserve what I had, which is ideally two parents, at least one parent; in some cases, they don't have that, but they need the support to get through a public school that's decent and come out to a land of equal opportunity.
(16:26) So society must do that or it will implode and collapse as homelessness, mental illness, drugs, and everything else increasingly shift things, as we're seeing take place now. So yes, you're going… Everyone will have different experiences, so somebody's got to rise above that. We'll have a war-an internal civil war -if we don't do that.
(17:00) And that's kind of where we are. And so if you see the cycles through history, that's what always happens. The capitalists gets… There's capitalism, communism redistribute the wealth and keep the wealth, and unfair advantages. How do you do that in a way that is healthy for the most majority of the people, so they have good experiences? That's the issue of our time.
(17:28) Special thanks to this episode’s sponsor, Pluang. Find out how you too can navigate big changes and open up a land of opportunities for Indonesian society by clicking the link in the description below. Would you be in a position to try to redefine capitalism? Yes. First of all, let's agree that it has to work for the majority of people.
(18:00) Most people. It's got to work for at least 70% of the economy. I mean, most. And let's establish the fact that there's a level below which we shouldn't let people go. And let's also establish that society as a whole has to be productive, that it's not just giving people money. So if you keep giving people money, that's not going to be good.
(18:26) We talked about that; you have to build a healthy education system and convert that into productivity. Productivity is a key word. The society as a whole has to be productive to be able to then have the income because it's not just financial income. Money just has no intrinsic value; it's what you produce.
(18:54) It's got to produce, so you have to be productive as a whole. Almost everybody's got to aspire to be self-sufficient, and you have to help them get there in order to operate. So if we all agree on that, there are wonderful things that we can do to help that: invest and aspire to equal quality education or higher.
(19:23) Don't lower the high levels to get equality or whatever. Aspire on how to raise the educational and security levels. In many schools right now, you have to go through a metal detector to make sure guns don't go into the schools. You have drugs. You have all of those things. You have to create an environment in which those children are raised well, have those basics, educated well, and made them productive.
(20:00) We have found out... my wife through her work. Her mission is to get high school students in the worst neighborhoods who would have dropped out, through high school and into jobs. We find that that can be done for about $450 per student. And so if you do that, you realize that's cost effective. But it doesn't have to be our program.
(20:29) But in one way or another, we have to define it. We have to define capitalism as also having all-in-cost. What I mean by all-in-cost is that there are costs to educating, to not educating a student, to having them drop out, to crime, and so on, or there are costs in our environment. If somebody can pollute the environment, and there's no penalty for polluting the environment, that's a cost to society.
(21:08) In one way or another, for capitalism and the profit system to work, it has to be all-in-cost. But we also have to recognize that the profit system alone is a great way of allocating resources by and large because it means that whatever you're producing is worth more than whatever it cost you to produce it.
(21:32) That's a good thing to have. But we also have to realize that it can divert resources from those things that we need most, like education. For example, the constitution in the United States makes education a state issue, not a federal issue, and then within each state, it's typically a tax district issue.
(21:58) So if you live in a rich community, you're probably going to get more money for education than not, and then your kids will be more privileged. There's nothing wrong with educating those kids well, but in some way, you've got to make it work and engineer it. And I see it in my philanthropy. I see it.
(22:23) For example, okay, here it is; we're here and COVID comes along, and the kids don't have computers. Okay, so there has to be an understanding of these basics: you need to invest in people and their productivity, and there are intolerable things that can't be done, not be done, or done in a bad way.
(22:55) And you can design that. The way to design that, by the way, is not by any one person imposing what they want. We have a problem here of polarization, and all different people have different views of what they want. Now they have extreme views of what they want, and they fight and don't resolve it. I think what we need as a country is bipartisanship of moderates who are intelligent and able to do the engineering.
(23:33) We should have a bipartisan president, I think; this is a dream, but there are things we can do; who has a bipartisan cabinet who brings together both sides there; moderates who agree more with each other than agree with the extremists, and then who are smart enough. And they should have something like the Manhattan Project or a constitutional convention in which there's something like a year and you bring them from the moderate left and the moderate right, who can work together and engineer a proper re-engineering
(24:18) or reforming of capitalism, how it works mechanically, and you can get there. Everything needs to be reformed; every machine, every computer, every thing, and every society needs to be reformed. And we need to reform the system so that it achieves those goals of working well for most people and making them productive, and that can be done.
(24:51) I'm in complete agreement with you on polarization. It's quite pervasive; it's not just in the US; it's all across the world. And I'm totally with you on this idealism of creating some sort of bipartisan framework of decision-making. But what I'm detecting beneath that is that there is a concern with respect to the inability to find the right intersection between power and talent, irrespective of the ideology, whether it's autocracy or democracy.
(25:30) I studied the 10 most powerful empires over the last 500 years and the last three reserve currencies. It took me through the rise and decline of the Dutch Empire and the guilder, the British Empire and the pound, the rise and early decline of the United States Empire and the dollar, and the decline and rise of the Chinese Empire and its currencies, as well as the rise and decline of the Spanish, German, French, Indian, Japanese, Russian, and Ottoman Empires, along with their significant conflicts as measured in this chart.
(26:12) To understand China’s patterns better, I also studied the rise and fall of Chinese dynasties and their monies (dating) back to the year 600. Because looking at all these measures at once can be confusing, I’ll focus on the four most important ones: the Dutch, British, US, and Chinese. You’ll quickly notice the pattern.
(26:37) Now let’s simplify the form a bit. As you can see, they transpired in overlapping cycles that lasted about 250 years, with 10 to 20-year transition periods between them. Typically, these transitions have been periods of great conflict because leading powers don’t decline without a fight. So how am I measuring an empire’s power? In this study, I used 8 metrics.
(27:06) Each country’s measure of total power is derived by averaging them together. They are education, inventiveness and technology development, competitiveness in the global market, economic output, share of world trade, military strength, the power of their financial center for capital markets, and the strength of their currency as a reserve currency.
(27:33) Because these powers are measurable, we can see how strong each country is now, was in the past, and whether they’re rising or declining. By examining the sequences from many countries, we can see how a typical cycle transpires. And because the wiggles can be confusing, we can simplify it a bit to focus on the pattern of cause-effect relationships that drive the rise and decline of a typical empire.
(28:05) As you can see, better education typically leads to increased innovation and technology development. And with a lag, the establishment of the currency as the reserve currency. You can also see that these forces then declined in a similar order, reinforcing each other’s decline. Let’s now look at the typical sequence of events going on inside a country that produces these rises and declines.
(28:34) In a nutshell, the big cycle typically begins after a major conflict; often, a war establishes the new leading power and the new world order. Because no one wants to challenge this power, a period of peace and prosperity typically follows. As people get used to this peace and prosperity, they increasingly bet on it continuing.
(28:59) They borrow money to do that, which eventually leads to a financial bubble. The empire's share of trade grows, and when most transactions are conducted in its currency, it becomes a reserve currency, which leads to even more bubble. At the same time, this increased prosperity distributes wealth unevenly, so the wealth gap typically grows between the rich-haves and the poor-have-nots.
(29:28) Eventually, the financial bubble bursts, which leads to the printing of money and increased internal conflict between the rich and the poor, which leads to some form of revolution to redistribute wealth. This can happen peacefully or as a civil war. While the empire struggles with this internal conflict, its power diminishes relative to external rival powers on the rise.
(29:56) When a new rising power gets strong enough to compete with the dominant power that is having domestic breakdowns, external conflicts, most typically wars, take place. Out of these internal and external wars come new winners and losers. Then the winners get together to create the new world order. And the cycle begins again.
(30:23) And so if we're realistic, we understand that dynamic and how it works because that dynamic has happened repeatedly through history. So you have to get to the notion: Okay, what does it matter most? Who is weak? Who is in control? It all can't be theoretical. So I think that we as a population will go toward a form of financial crisis system, civil war, and external war.
(30:57) If we don't have fear of that… I have a principle: if you worry, you don't have to worry. And if you don't worry, you need to worry. Because if you worry, you will take care of what you're worrying about and chances of happening are reduced. And if you don't worry, you'll headlong into it.
(31:19) I think we're not worrying enough about these things. And only if we recognize that we have to pull together and that there's a strong middle, there needs to be a strong middle, and we pull together and we're not so hung up on exactly how we do it, just as long as let's agree on how to do it and work there so that we can do it. And there's no other path.
(31:46) I sense that the world is not worried enough. And what would it take for anybody across the world to be more worried in the context of the five forces that you've been talking about: indebtedness, internal conflicts, external conflicts, climate change, technological change, and all that? It just seems that nobody's worried enough about any of these.
(32:13) It's because we've never experienced it before in our lives. What's happening now is one of those things that comes along once every 7500 years kind of thing. And we only react to it. So we each go into our happy worlds. Let’s think of our experience: you go into your neighborhood, I don't know, we go out to dinner, go to ball games, they watch their streaming of this and whatever, and there's not the experience.
(32:52) And it seems so... Why worry about it? I mean, everybody's talking about it, but I'm not experiencing it. The only way we learn is through experiences and sometimes the pain that they produce. And so we haven't had this. It comes along once the new world order began after the last great fight. The war.
(33:20) Okay? You have the war; you have the pain of the war; you have the restructuring; you establish who the power is; nobody wants war again; you take that generation, my parents generation, who lived through the Depression and war, and they come out and they have learned, okay? They have learned to save, they have learned to not get into war, and that learning and establishing who's in control sets the stage for the prosperity that comes that then we produce these greater wealth gaps, a sense of unfairness, and debt bubbles.
(34:07) And we do the same thing again; you have a debt bubble crisis, and so on. So if you can get them to intellectually worry, and that's one of the things I'm trying to pass this thought along. If you're worried you pass that along, but sometimes it's going to take experiences, and then it's going to take figuring out how to engineer it so that you get through it.
(34:33) So you have to have agreement from smart, reasonable people about what to do. That's just how reality works. Bridgewater has done excellently over the past few decades. I would speculate that it's mainly because you've been the great Chief Worry Officer of Bridgewater. Now, would it help? I mean, would you advise anybody out there, be it in a household, in a school, in an office, in any social institution, as for them to have some sort of Chief Worry Officer so that the world will be better off going forward?
(35:13) I don't know. I think the world is (full of) worry and opportunity, and then knowing how to go after the opportunity while minimizing the downside. And I learned how to do that through my painful experience. If you want, I could tell you about it. But anyway, through this painful experience of being painfully wrong, I learned humility, and I wanted to find the smartest people who would disagree with me to stress test me and also for me to learn.
(35:56) And I also learned how diversification of my bets could reduce my risk by up to 80% without reducing my returns. So I think people have got to learn those things. They have to learn how they can have great upside with opportunity while virtually eliminating the unacceptable downside. So you have to learn that through experiences and so on.
(36:36) I think experience is the best teacher. My dad learned it because he went through Depression and war. He didn't earn much money; he was a jazz musician. He raised me. I went to great school. He had everything that he needed. We had everything we needed: a nice house- not a mansion, of course, but a nice house-food; I went to public school; we had a car.
(37:03) Everything that he needed. And when he died, when he was 91, he had over a million dollars saved up, and that's a while ago, so that's a few million dollars. And he had a great life, and he learned it because you can do that. You have to give up overindulgence, let's call it, and you do that. So in each of our own ways, we can learn it, perhaps through experiment.
(37:38) Of course, we want to do it intellectually, but... So I don't know that… The real question is: is the person in charge like that? You have a Chief Worry Officer; it's good. Yeah, companies have risk officers; it's a good thing to surface those risks and also know that it's only one in 20 years or one in 30 years that'll kill you.
(38:05) Like, all companies die. When I decided that I was going to run Bridgewater, I did certain things to make sure that it couldn't die. It can [inaudible] because... but we would not go broke. And so, yes, that worrying is good. I don't know about… But you have to have it in your bones and in your leadership while you're also excited about the opportunities.
(38:29) I mean, Bridgewater was amazing- a two-bedroom apartment, 1,500 people, and we made more money for clients than any hedge fund ever in existence. They made money, and we made money. We have a community. It's built around meaningful work and meaningful relationships. It was great. But there is a way of doing that balancing, and you have to know it and want it through experience, I think.
(39:00) Yeah, you've done really well, man. I mean, you've made money in what? 28 out of the last 30 years or something like that. It's awesome. Yeah. Because I don't want to lose money. And we made great money. And yeah, we made more money for the investors than any other, so yeah. You're one of the earliest observers of China.
(39:25) You've done business there, and you've interacted with so many personalities out there. I want to talk about the current US-China relations. And I want to put this in the context of what you've alluded to a few times in the context of the 100-year storm in horizon. Talk about that. Yeah. I've been very lucky.
(39:52) In 1984, I was invited over by CITIC, which was called the “window company”. It was the only company that was allowed to deal with the outside world. In 1978, Deng Xiaoping came to power, and he wanted to have an open-door policy and great reforms, so I went there. And I went there out of curiosity. They didn't have any money; they couldn't pay me anything.
(40:22) And I went there out of curiosity. And I started to develop these wonderful relationships with these wonderful people about helping them develop their system, their capitalism, or so on, for a long (time). And we've been long old friends over a long period of time. It was something like 12 or 15 years.
(40:45) I was there before I ever earned any money, and it was the satisfaction of that relationship. And that's continued to today. I studied the dynasties, and I've had the experiences. Since I started going, China's per capita income has increased by 28 times, life expectancy has increased by 10 years on average, a poverty rate went from 88% to less than 1%, the greatest economic transformation of all time, and there's a great understanding of history.
(41:24) That's why Xi Jinping says that there's a great storm on the horizon, a one-in-100-year storm on the horizon. And that storm that we're facing- we're all facing it in the world. In the United States, we're talking about it; the same cycle I talked about with a combination of debt, wealth gaps, and international conflict.
(41:54) Okay, that storm. There's a great storm on the horizon. And then there's the reaction of how do you deal with that great storm. There's internal conflict, and there's external conflict. So what's happening in China now is largely what always happens in such periods of great conflict, and they know it; they've seen it through their dynasties that everybody must line up and be...
(42:28) There's no room for fighting between ourselves. There's one side, and everybody must line up and be on that side, and if there's any wavering, “Okay, off with your head,” or something like, “You have to deal with that.” That's something, by the way, we're dealing with in the United States and democracies in their own ways and histories.
(42:54) You have to look at history, and when you go through those periods, even the most democratic countries, you cannot say a lot of things. You can't do anything; you have to line up and follow. And so we're doing that while there are these classic things we're fighting over. So for example, in World War II, when we had world deppression, there was a conflict, let's say, in Japan.
(43:23) By way of example, it happened with Germany in Europe and Japan in Asia. There's this conflict, the geopolitical conflict. In the geopolitical conflict, the United States cuts off oil to Japan and also freezes their assets. And when they freeze their assets, that leads to Pearl Harbor. The same dynamic is going on; chips are now oil.
(43:59) And so that's the dynamic. There's a fear in China and other countries that they might get sanctioned by the United States, meaning if you had dollar assets in Japan, the world, or Russia, they would make them worthless. That particular dynamic is sort of happening again. And so that's where we are.
(44:26) We have a number of issues that are irreconcilable differences. So we're at the red lines on a number of those issues. I could touch on them briefly, but there's obviously the Taiwan issue; go to the history of Taiwan. Okay, we're going to go back. There's what's called the “hundred years of humiliation”.
(44:52) The west and China lived in two largely different worlds that then came together when the foreign powers, particularly the British, came into China and wanted to trade, and China said it had all its needs and didn't want to trade. But they want to force themselves in; they create the Opium Wars. This started in 1840.
(45:22) And they create the Opium Wars to sell opium to get that and whatever. And then they have military conflict, and different foreign powers take different parts of China. Japan took Taiwan in 1895. Fast forward, you go to the end of World War II: Japan loses the war, the new powers win to find who gets what territories, and China is given back Taiwan.
(45:58) And so everybody agrees that Taiwan is now reincorporated into China. But China has a civil war between, again, the left and the right, the Communists and the capitalists. You have this war. The capitalists run to Taiwan. And so there's an argument over who controls Taiwan. But there's one China, and it's an internal civil war.
(46:26) 50 years later… Excuse me, 50 years ago, Henry Kissinger goes and everybody agreed China's part of Taiwan. Now we have the possibility; there's a question, supposed to be peaceful reunification. Over time, 50 years later, it would be considered a declaration of war if the United States said that Taiwan would be an independent country.
(46:59) That would be intolerable. But there's the pushing of the edge of that, which means that in favor of the defense of Taiwan, the United States will act in favor of the defense of Taiwan, send military equipment, and so on. And so that's one example of something that is right at the edge and is kind of an uncompromisable and difficult situation.
(47:30) If you take a number of the issues, like if I take the issue of support for Russia in the war here, it's a big issue. If I take chips, if I take trade, if I take many things, we are at those lines, and therefore we have this great power conflict. Wow. You know, in the seeming trap between China and the US, what would be your views with respect to Southeast Asia? Do you think this is more of a threat or an opportunity for Southeast Asia? Before I answer Southeast Asia, I want to emphasize that in that struggle,
(48:27) there will not be a winner or a loser, but the ultimate winner is going to be that conflict, which will all depend on how strong the country is internally. Got it. It will depend on how financially strong it is, how productive it is, and how people deal with each other internally to be strong. So both of those countries are going to struggle with each other, but their main struggle is an internal strength struggle, and that will determine how the external conflict goes, I think.
(49:13) And to answer your question, it's an opportunity more than a risk. I'll give you the history. Neutral countries: In wars, there're winners, there're losers, and there're neutral countries. Neutral countries do better than the winning countries in wars because the winning countries get into debt, like when the British won the war but went bankrupt.
(49:47) The United States made a lot of money because it entered the wars late, so all the gold that it accumulated... Gold was money at the time. The United States accumulated 80% of the world's gold because it entered both World War I and World War II late. So neutral countries that don't get into war… The three big ingredients for a country are: do you earn more than you spend, so you have a good income statement of balance sheet? Do you have an internal dynamic that is destructive or productive? And are you in an international war?
(50:29) And so, when I look at the emergence of countries in the ASEAN region of the nature of how Indonesia, Vietnam, and the Philippines, other those countries. They're coming up with higher rates of capital formation. They are operating in a way that's going to be more productive. They are… If they remain largely neutral and can avoid being in that war and that.
(51:09) They will do well. Singapore is emerging as almost Switzerland kind of capital for various reasons. And so that is an area of opportunity. India also benefits from this because you also see that companies don't want to be in China because of the nature of the whole war situation. Not just military war, but let's say economic war, and they're worried about that.
(51:44) Then they go to these other countries. And then they benefit; capital goes, business opportunities go, and so on. That's also, by the way, happening in the Gulf countries in the Middle East to some extent. So it is by and large a benefit if those three ingredients remain in place. Those three ingredients: earn more than you spend, have a good income statement balance sheet, work well together, eliminate corruption or minimize it, create capital formation, and create opportunity.
(52:27) And then number three: don't get into the war. That's great advice. I'm going to push on this, Ray. In the context of the need to spend less than you make, the need to borrow less than you make, and the need to be more productive than you make, between China and the US, who's likely to be more competitive in the next few decades in the context of all those? The United States has a very unstructured creativity that also with its capital markets and adaptability, is able to invent very quickly.
(53:22) It doesn't make a strategic plan; it doesn't have the... it's very much a bottom-up type of approach that also does create the problems that we're talking about about the large wealth and opportunity gaps and those types of things. And when Plato… This dynamic and question have gone back a long time; democracies existed for a long time.
(53:51) Plato wrote ‘The Republic’ and he made the point that there are cycles, and what happens is that the greatest risk to a democracy is anarchy due to the internal fighting creating disruption, and so on. So the United States has those advantages and has that challenge about that internal fighting and how that works and gets through it.
(54:20) Then you go to China, and it is now dealing in a much more autocratic, top-down-directed kind of way. So, that will direct resources in many cases to producing, like in a war economy, the things that are going to be needed. In other words, in many cases, how does a war economy work? You don't have a free market operating in that economy because of the profit system.
(55:07) People going and spending a lot of money on expensive handbags are not going to be productive in a war economy; it's just not going to work. So you have that sort of directed, but that directed is going to be less corrected, but it's going to be very focused, and you won't have people fighting each other in the same way as long as you keep that.
(55:31) And so you see that kind of approach. Those are the differences in the approach. Both of them have their vulnerabilities, so as we go through that, I think one can't easily say one side is going to win over the other. Each has their vulnerabilities, and each has their advantages. So I'm not going to pronounce it.
(56:06) It's all a function of your circumstances. There comes a time where everybody lines up doing what they're told to do: go fight the war, and all that is an advantage. And there are times where that kind of thing is a disadvantage because top-down leadership and all the decisions have to go to the leader, and everybody's fearful, and because they're fearful, they won't make decisions, and that has problems.
(56:38) So it looks like that to me. I don't think we should worry about pronouncing a winner; we just have to know that there's going to be a conflict along those lines, as there always has been. Got it. Ray, one of the five great forces you've alluded to earlier is climate change, right? And I've been alluding to the fact that the sustainability narrative resonates with only a small portion of the world population, whereas most of the world population is more concerned about putting food on the table,
(57:19) irrespective of how the energy is sourced. In your view, how do you think we could help reconcile these two seemingly irreconcilable narratives; the narrative of development and the narrative of sustainability? I don't know that I have the answers to all the world's problems. So let me just describe what I think is the reality of what is going on.
(57:52) We have a situation where, as you point out, one of the five great forces throughout history has been acts of nature; droughts, floods, and pandemics have killed more people than wars, caused more governments and geopolitical systems to collapse, and so on. And it's a huge deal right now, however you deal with it.
(58:22) If you don't deal with it, it's a huge deal. If you deal with it, it's a huge deal; it's going to be costly. There are three types of costs for that. There's the cost of going from, let's call it, brown energy to green energy, which is very costly. You have to invent the energy, you have to re-adapt.
(58:45) And in that period of time, there's a gap in not investing in brown energy. And so there's a supply-demand issue, and it becomes costly. The second cost is the building of infrastructure to deal with climate change. Literally, in Indonesia, it's an issue for Jakarta to others, so you have to build infrastructure.
(59:17) How do you deal with the infrastructure that's costly? And then there will certainly be damages; droughts, floods, all of those will have damages. And the estimated cost of these things in one way or another, however you spend it, is in the vicinity of $10 trillion a year, depending on how you do it. Let's go up five to 10 trillion dollars a year.
(59:44) World GDP is a hundred trillion dollars a year. So 5 to 10% of GDP is going to be this cost that is going to come on top of the other costs, okay? So let's first realize that. Let's digest that. How are we going to deal with that? Then, as you point out, there's the developed world and the emerging world.
(1:00:16) And the emerging world has a larger population, and is poor, and in many cases, is not efficient in many countries that are corrupt, and so on. So how do you get resources or affect change in the underdeveloped world? First, where does the money come from? Where's the motivation come from? How do you get through the corruption and so on? Well, there are no easy answers to these things, right? The only answer to all of this is when the greater good rises above the individual good as the priority.
(1:01:20) And then it becomes a common problem. So how do you get the resources and so on? You know, during such times, the opposite is true. I'm going to fight for me, and we'll line up and fight for us. So I think it's going to be an intractable problem. Claudia, I’m going to be interviewing Ray Dalio next week.
(1:01:57) I know you’re a big fan of his. Any questions you want me to ask him? Yeah, wow! I really like Ray Dalio; I’m a huge fan. Actually, I do (have a question). I’m thinking, what would Ray Dalio tell my 5-year-old daughter if I had one about the next 10 to 20 years of her life? What should she expect? What should she think about? - I'll question that to him. - Thank you, sir.
(1:02:28) Very excited for your time with Ray Dalio. - Tell me how it is. - I’ll let you know. Thanks. What would Ray Dalio advise a 10-year-old kid anywhere in the world in terms of what he or she needs to push forward in the future? I'm going to give you the longer answer again. There are three phases in life, I think.
(1:02:57) There's the first phase in life where you're dependent on others; you're being raised, you're going to school, and at 10 years old, you haven't yet transpired into puberty; it's just part of puberty. And you're learning in a unique way that actually the mind-brain changes out of puberty in a way that you're having experiential learning, you haven't yet had the rebellion for your parents, and so on.
Keren Pak Gita tamunya Ray Dalio
Oh my goodness ! Ray Dalio the legend
Its a great videos i ever seen
Wow bsa interview ray dalio.. Ruar biasa
Recommendation list svp, not in particular order:
Stephen Fry (the most eloquent I've ever heard)
Yuval Noah Hariri
Morgan Housel
Jeremy Grantham
Nassim Thaleb? (Too cynical perhaps)
Cliff Asness (that's my fave😅)
Dr. Siddharta Mukherjee
Dr. Henry Marsh
Prof. Sean Carroll
Prof. Brian Cox
Malcolm Gladwell
Daniel Goleman
Daniel Pink
Burton G. Malkiel
Cass Sustein
Richard Thaler
Robert Shiller
David Rubenstein
.....🙏🙏🙏