“People DON’T KNOW What’s Coming!” Prepare For The CHANGING WORLD ORDER | Ray Dalio

and what do you believe will happen if we don't prepare for the changing world order then what we have left our generation with is debts a broken down infrastructure and fighting so i mean the answer is for people that don't know what the changing world order is or why we should be prepared for it is it really these main three things we've talked about the first one is it is that what it is or is it something bigger that we should be worried about or concerned about these produce big things like finis you know financial crisis or civil wars or external wars so we should be concerned about those things yeah so we talked about the financial the second one that's happening in a way that never happened in my lifetime before uh is the way we are with each other uh in terms of internal uh conflict that has created a polarization which is a win at all cost mentality is this nothing that you saw when you were growing up oh no no no it was not like this and i i measure in the book a lot of uh measurements okay okay i could tell you that um the amount but you'll see in there the amount of political um polarity and the amount of compromise the amount of political polarity is the greatest since 1900 the amount of um compromise is the lowest it's been it's measured by how people will cross voting across party lines right uh there's it's there are two monoliths and they're at war with each other okay and we have populism which is you have to get on one side or the other okay and so when the causes that people are behind are more important to them than the system the system is in jeopardy so you see this reflected right now in the politicalization um and and ideologies at a war you you know yeah um um and i'll give you lots of examples or i'll give you a few um the risk of um neither party accepting losing the elections is high it's significant right right how does that work if they don't accept losing the elections okay the move toward uh power dynamics uh let's say a good example will be there's a couple of supreme court rulings that are coming out related to abortion and gun rights it would not be surprising to me if those supreme court rulings are not uh followed by some states um or um the good another good example would be um so so essentially saying we're passing a law but then the state's saying we're not going to abide by the law right and and and you're seeing it it's hardball it's hardball uh it's like um you know governor desantis florida and disney you know um ordinarily there is um okay we do it by fighting each other and what kind of power testing each other's power almost to hurt each other and and that um and so uh the the idea of democracy is um compromise and reaching costs that the law and the rule is of a higher purpose than anything else but when you get other things that are more important to people that they're willing to fight for um then you get greater and greater and it's self-reinforcing because uh moderates our poor people want to work across party lines and so on and compromise um are his through history through the french revolution russian revolution chinese revolution or these are civil wars in all of those cases um the moderates um are either they're hurt or they they're disposed of and you have to pick a side really well but you're seeing this now you're seeing right now that the political parties are um are are are united in one way or another there's not much and you you better pick a side and because that's what it's like so that um can have um important consequences in terms of conflict in other words it's power and that's happening uh not just internally and it's certainly happening internally but it's happening externally too but internally there's there's a dynamic that is going on in which the ideologies rather than normal economics that we're used to normal normal politics and normal economics rather than that the ideologies are dominant so for example um you think about that when elon musk buys um twitter um the decisions he will make regarding twitter will probably have a greater effect on our society than the decisions the supreme court makes wow that's crazy right what's your thoughts what's your thoughts on that him him buying twitter and and doing what he did that it's a reflection that it's one of the symptoms uh like uh desantis and disney like tax present like the supreme court whatever it's one of the symptoms that the ideology that i'm fighting for the power that i have that it's not normal economics in the usual way you know there used to be normal economics was it's all just you know kind of almost you're you don't care about ideologies or something you're just um getting an roi and that the system will be better off if we allocate resources that way um and so on now it's that the system is better off if we ideologically choose the things we want and put the resources in that and that there's a you know a power game so it's a different game that people should be aware of mm-hmm yeah i mean you said uh one of your quotes is the nation's greatest war is within itself over whether or not it can make the hard decisions needed to sustain sustain success is there even a way we can unite behind a common purpose in the united states in your mind or is it the power dynamics and human psychology is so strong that people are going to be making these decisions and not want to unite over the next few years and decades i have a principle which is that if you worry you don't have to worry and if you don't worry you need to worry because if you worry about things like if you worry because you get yourself into too much debt and you've got that then you'll do you won't do that if in our particular case if you read about the consequences of what has happened in history about that and you look at the likelihood and you say okay we can have this kind of a conflict or we could have that kind of a conflict external conflict and boy these conflicts are terrible maybe that sort of brings us more together because we have the power together if we don't fight each other in that way and we can compromise and so on we have uh the power to produce incredible great results because we have more resources than we ever did there's more by any measure life expectancy is a lot greater uh gdp is greater technologies are greater and so on um so uh in a sense our riches and our intelligence is greater than ever before the biggest risk is how we are with ourselves and so there are just basic things like do you earn more than you spend okay do you if if everybody strolled for that are you being productive or earned more than you spend are you uh good with other people okay um so you look at so that it's and we're not fighting we can compete in a healthy way but we're not doing each other harm we can have win-win relationships uh we have a great power but we're gonna have to make a big adjustment because we're spending a lot more than we're earning okay producing a lot of debt and money it's devaluing and we are at each other's throats and i i think that we don't do a good job of taking care of each other even by comparison and but especially by comparison with a lot of other countries because we don't create a bottom a level that you don't let certain people fault below i'll give you an example yeah my wife and i uh particularly my wife we live in connecticut and she works to try to help um what are called disengage and disconnected high school students in other words those in the poorest neighborhoods who the education is failing and they'll drop out of school so in this state which is one of the richest states in the country on average per capita income 22 of the high school students are either disengaged or disconnected disengaged means 22 22 of the high school students are uh either have an absentee rate that's greater than 25 percent in failing classes or have dropped out of school one in five more than one in five yeah so what does that mean living in neighborhoods wealthy neighborhoods right well no no the thing about it is i live in greenwich connecticut and up the road is bridgeport connecticut not far up the road and that's a a poor neighborhood okay um because um there's not much income in that neighborhood so what in greenwich connecticut you spend 24 000 on average for a student in school public schools there they spent 14 000 and there are and their guns in their shootings and of course if a kid grows up in that kind of an environment where one in five where are they going to be you know where is their income and their their society is gangs and their income is um selling drugs or crime and that and we've allowed that to happen we've allowed at the bottom and it's perpetuating so what's happening is that that's growing and it's encroaching you could see how crime is changing okay um and you could pick cities you it could be it could be new york it could be connecticut it could be chicago it could be san francisco and so on los angeles it's encroaching and so people are going to smaller and smaller enclaves which might be terrific okay you know like but it's it's that's what's going on and it's costly the in the state of connecticut it costs um 600 million dollars a year for incarcerations because where where do those people go okay it's crime and then you're trying to do it that kind of a thing um has a terrible cost when i think about what my generation has left the other generation it's terrible um you know i uh i was just in singapore and uh what they had is they had savings a lot of savings and all because they have a large savings the income from that savings covers 20 of their budget hmm wow so one generation is giving the other generation a savings a good education and civility and this happens in certain places what we have left our generation with is debts a broken down infrastructure and fighting so i mean the answer is um if we're all good with each other and we're productive and we earn more than we spend we won't have a problem but we got to get there how have you learned to bring together this great team that you've assembled where people are going to disagree with you it sounds like people would have different thoughts and be able to free to disagree with you on certain things how do you know when the disagreement becomes toxic when you can look at it from a point of view of like okay i need this disagreeing thought but when does it become toxic where you actually need to let go of that person in your life or on your team well what's so interesting to me i think is that you immediately your question about the disagreement is toxic um that's the first thing that people go to somehow they think disagreement is toxic and supposedly it's because the part of our brain which is the amygdala which is this fight or flight takes disagreement as the equivalent of a fight and so it anyway gets triggered that way now instead um imagine it's a curiosity in other words i view it as a curiosity i mean i could tell if somebody's uh wanting to disagree with me or i'm disagreeing with them because i want to hurt them i mean that's a different thing if you want to hurt them okay then that's a different thing but i mean like disagreement should be a comfortable thing that prompts curiosity and so on and mutual respect like if like how could i ever get along with you if i couldn't disagree with you i like how many times you know i mean you're gonna disagree like you might one thing another then that's the beginning of trying to find out what's correct in the past so a good partner is going to disagree with you and you have to get past it so the fact that you're asking that question the way it is which is a normal question that everybody would ask so reflects the fact that there's a hesitancy for disagreement that gets a bad thing and it's a fight and it's nastiness rather than just a disagreement that needs to be figured out and how have you personally learned how to disassociate the maybe personal attack against your ideas or your position on an on a a stance or whatever between someone personally attacking you and just oh this is a curious idea that they have let me ask them more about it how have you learned how to do that and what advice would you have for others first of all i learned by it because it you know like it works i i mean uh you know like i'm afraid of the opposite and and how can i have it helps my decision making it helps our relationships what are they going to do bottle it up and i'm going to bottle it up is that smart i mean you know that that sounds stupid to me you'll you don't even know what's true you can't figure it out so everybody's confused because nobody knows what each other's really thinking and then also like uh you know you won't get to the right answer and i mean that just is too stupid a path for me for me to do it it's too risky pass and it's so much rewarding so much more rewarding to do the other right have you always been like that or was it until you went but i think what helped me get that way was the markets okay because i again what happens is you know there's just being right or wrong there's just a winning or a losing and and okay so just imagine you're uh you know it's like being a trained monkey you you you know like it what works you okay should we push a button should we push the button okay okay yes okay it makes sense button is better than i'm going to push the button push the button whatever it is okay no i don't see it that way okay let's figure it out and so on so i and then the scorecard i think probably had the benefit of that kind of notion i got a scorecard okay i don't know like i'm not sure okay bring it on please stress test me oh that's great we have we're good partners so that to some extent i think uh played a role in you know my types of experiences maybe if everybody had a score card on all their decisions and then was being able to experience essentially you try it one way you try it the other way and you start to see what's better and you get punished one way you get rewarded the other way naturally you want to go in the direction you get rewarded right so you stop thinking okay my way is the way you start basing it based on data and scorecards isn't that so stupid my way is the way i just want to make the right the best decision possible i don't care where it comes from yeah but did you at one point in your life for a period of time were you committed to your way and thinking that you had the answers well i i like i say i think before that uh 1982-ish incident i probably was a lot more okay yeah okay you know i think it's right and what i think is right and i'm a smart guy and so on so i was like you know that life is a good teacher just a good you know like two by four in the head you know and you got a couple of those and you know pain plus reflection equals progress yeah what is thoughtful disagreement in your mind and how important is that in this moment especially with the this political unrest and economic unrest and just everything how do people have thoughtful disagreement as opposed to kind of toxic disagreement well first of all they you know they got to want it but let's assume they want it you know then there are three things you have to do basically first you have to put your honest thoughts on the table and have the other person put their honest thoughts on the table okay so now you know what you honestly think both sides that's great then you then there are protocols for disagreeing well you know i wrote a bunch in the um in the book yeah um yeah and um like i could go through some of those types of things there are certain exercises that you can do you know there's a i have a two-minute rule you speak with two minutes without the other you start to think are you blocking um you have a mediator maybe in other words somebody when you're disagreeing if you can't disagree say we mutually agree that this person will be our mediator and and we'll or and or maybe to the judge they'll decide maybe it's a group that decides that but in other words you have a protocol for disagreeing and then and then deciding sometimes in that disagreement hopefully you both learn a lot and you may reach an agreement but you still may not have an agreement but then you try to say what's the best protocol for moving fast that discipline you know uh like a uh you have a judge and a jury and you know they have a case and anyway what do you have good protocols so so you have to have three things you have to put your uh honest thoughts on the table um you have to go through processes that helps uh to reach the right answer depending on how serious the question is right if it's um and then number three you have to have a way of getting past that decision and moving on um i have a basic view though whenever there's any disagreement or anything that's not going well stop okay pause don't just keep banging at each other when it's escalating when people are yelling at you just pause and and sort of go above it and say what are our ground rules for disagree what how should we be with each other and you turn your attention rather than to the argument at hand but say okay if i think this and you think this how do we do this and then once you agree okay then you go back into the argument and then you follow those protocols because half of the problem is that people just don't even agree to know how to disagree but but if you do it that way with those protocols and so on and you get past your disagreement it's it's great yeah i want to talk a little bit answer to your part two of your question yeah um the greatest problem of mankind i believe wow that's a big statement the great problem of mankind and it is an exceptional problem at this moment in time is people having opinions that they're stuck on that um they won't you know like i have to have my opinion and that's right and so on because it prevents them from um resolving it up from moving forward to finding the best answer from compromising and or doing you know so like everybody's arguing over everything and and they and you know they're they're it's almost like they're killing each other and and we're in a society you know i have another principle which is when the causes that you're behind are more important to you and others than the system the system is in jeopardy so do you are you just literally going to go fight so here we are as we think will we fight or we have or will we have protocols for having thoughtful disagreements and getting past them that's why i love your principles and protocols in your opinion how has this last couple of years been in the history of uh investing for you in the history of the last 40 50 years is this a really really bad time in your lifetime or is this just another bad time but not greater than previous bad times you mean in the world in the world yeah um there are three things that are going on now the three most important things that are going on to great extremes that have not existed since the 1930 to 45 period okay and it's important to know those three things and then to understand them well okay uh the first is um what is going on with money and credit when you get to something like a zero interest rate and um you need buying power the government needs buying power but they can't they can't tax it and they can't so what we have is the production of a lot of debt that the central bank prints money and buys that debt to spend and the last time that happened in the last few years it happened starting in 2008 interest rates hit zero they couldn't lower their interest rates so they had to print a lot of debt and the government went in and bought it okay and we're coming to the end of a debt cycle okay so this is a big thing like because where does the money come from and who will get what the government will now determine that and then they'll print it and it'll devalue money okay this is and how money flows a big deal so that's number one the second one are wealth and political gaps that are causing great conflicts throughout history there's always been the main things that everybody's always fought over is uh money and power particularly political power so what we have is a situation when you have a large wealth gap and you have an economic downturn particularly if you put a large a lot of debt having at the same time you you have a fight i mean that's been true through history um and it it's reflected in the political gap so the political gap is um you know it's classic political gap left right you know um okay capitalist socialist how do you distribute it how do you how are you going to deal with that that becomes the other and how you fight so that's the second of the two you know this wealth political gap that's causing the conflict and it's coming at a time where we don't have much money because we're print we don't have a good financial position we're printing and then and putting it out so we're still paying off debts still right yeah but with made-up money i mean meaning what what happened like covid was such a good example okay you have covid and a a lot of people and companies had falls in their income that were would be ruinous okay if checks didn't go out we would have had a revolution right and and so that those checks and how do you save everything and so on okay so and it's not like the government had real money like they it's if they didn't have any money they already owe a lot so they just printed more money to give they made more debt and then the government and the federal reserve printed it and that you know the checks went out which diminishes the value of money and so on and changes things yeah so then the third thing is the rise of a great power to challenge an existing great power so the rise of china to challenge the united states in all history there are world orders what that means are are um you know there are the dominant power you know it's like in nature almost you know the big bull or something anyway there's the dominant power and then what happens is in 1945 um the united we entered the american world order we the united states won the war and it um it ended and then in 1945 well the the winners of the world carved up the world we had uh 80 of what was considered money at the time gold 80 of the world's money essentially we counted for half the world's economy and the rules were set in the united states basically that's why the united nations is in new york the world bank and the imf are in washington dc because we began the american century okay that's and then uh we are now at a time we've never had somebody another power challenge us in the same way there was the soviet union but they were always a fraction of the size economically so couldn't compete on that same basis they had nuclear weapons but they didn't have the economic power and so on but now we're dealing with china coming on as a power i spend a lot of time in china over the last 36 years by the way and i admire how they're doing a lot of things right i mean i know it's controversial to say that but um in terms of like they're a power yeah whoa like sincerely since i started going there uh their average income has increased by 30 times you know so they're a comparable power and they're also growing faster and so that as it has an effect so those three things are things that never happened in my lifetime before but happened before in history which led me to do the studies of of what happened in history and the lessons i could gain what is that those three things uh money and credit wealth and political gaps and the rise of china what is someone like myself or some 30 40 45 year old 20 year old what should they you do with that information what should they be aware of how should they apply it does it apply to people uh in america general america or is it only applied to the wealthy what should we be thinking about no i it's a it affects everybody you know it it affects like we know let's start with ourselves most importantly forget about the outside thing can we be healthy and strong and what do we need to do like to know that you you have to be in it together like if we can row in the same direction okay if if we can have thoughtful disagreement and get past that if we can be in it together like the wealthy and the poor and and and you know and if you figure it out and and i know it sounds so difficult but at the same time if you read history and you see what happens when it's not when you have a civil war like we could be on the brink of a civil war that sounds so crazy but the truth is in most countries in in in almost every century there was a civil war or a revolution some form a civil war revolution um so it's almost inevitable that we're going to have something okay you either resolve it or you you start fighting so badly that you damn you really do tell yourself to each other until you resolve it yeah well the the once you cross a certain line there's no coming back okay because you do the damage you you you demonize and that person such an enemy or that class of people is such an enemy that you that the communication's gone and the fight well you see this in politics today in other words is there a respect for the system and a mutual respect of trying to fight find resolve these types of things or will they go to any lengths to win because a constitution or law will only carry you to so far okay there has to be an element of respect for it right if you think about the presidential elections quite something that we as a country as a people um when somebody might win the popular vote somebody else wins the electoral vote there's not even an argument like in other countries you might say those who had the popular vote would say what the hell i've won the popular vote i think it matters and somebody says electoral vote and so on okay there's not a question about that okay now um when you start to say okay is it this vote at that vote or this thing or that and how far are you willing to go to fight and does the rules matter when you start to get cross that line and you do harm you hurt and you alienate then you go to accelerate this process and people should know what that looks like how terrible it is so maybe if they know what it looks like and how terrible it is and they can empathize a little bit but i i see people don't don't see it i'm living in greenwich connecticut um connecticut has the highest per capita income in the country and it's got the largest wealth gap most of the people in connecticut are pretty poor really some cases very poor oh i'll give you an example this is the community my wife works to help high school students 22 of the high school students in connecticut are either disengaged or disconnected what that means is disengaged means there have an absentee rate which is greater than 25 and they're failing classes they don't show up to class that's right they show up you know three quarters of the time and they're failing or that's disengaged disconnected is they don't know where they are they've dropped out of school 22 one in five so school is not working for them and they're in desperately poor areas like okay we have the coronavirus and so her efforts and our efforts are philanthropic that's what got her involved they don't have computers they don't have connectivity they they have they have problems getting food they get food in school they need the food in school because they don't have adequate food okay and this is connecticut and it's right up the road so we had to we we bought these kids 60 000 kids computers and then we're trying to get connectivity and so on and you start to see this okay this is the same world now um i so i live in one every neighborhood with my community and then there's the other they don't understand each other they're they're um they haven't lived there they haven't empathized and in fact there are resentments on both sides right like um the people in my community they don't feel they're very rich by comparison to um those other people but also to take care of their families to educate them they have their own challenges the work life balance and so on they have their financial insecurities and so on so that's what they're focused on and then they might think all these other people they're not taking care of themselves why don't they pull themselves up by the bootstraps do you know what it's like to be a kid growing up in that neighborhood and trying to what what are you talking about you can't pull yourself up from i mean well you know there's a problem there's not enough food there are gangs they even walking to school neighborhoods that are gang shootings and you can't and there are not enough police to do it okay so these two worlds ex and then the others uh say you know well um here we are and you're walking around with your fancy cars and your you know fancy clothes and and so on and we're suffering i mean come on and so they don't understand each other and so on we have to get past this we have to be in it together i think otherwise we're going to kill each other how do we what's the main thing that both sides need whether that be in greenwich connecticut or in the usa on different sides is it empathy is it compassion is it a awareness what is that thing that both sides need in any rich poor dichotomy well there's the there's the intellectual thing they need in the emotional thing they need okay intellectually what they need is maybe emotionally the fear and the understanding that where this will lead will be devastating okay if they don't deal with it if they don't deal with it together and you look at history you need the fear you can't give people necessarily empathy or love you know we could say oh they should care about the other person okay that's too much to ask i mean yeah you know that's not realistic okay but realistic is that you if you don't if we all don't get it together or going to have you know you like all that stuff you got well you ain't gonna have it anymore and and all of a sudden the things that are the most basic in terms of uh take care of it and then if you start to realize um that it's productive like if you if what what do you need to be successful it's all i had when i grow up was um i had uh parents who loved me and took care of me i went to a public school okay and i came out to a world in which there was equal opportunity those are all the only things you need and you know healthcare but when you're young you don't need much of that so um those are the only things you need um now even in these communities sometimes you can't get the parents but you you can get people who care about them they're teachers and so on but you have to just try to strive for equal opportunity do you think we have an opportunity no of course not let me look at any any of the statistics i mean i i i can give you examples i i studied um this issue because first we when populism started to come around and um i thought that was i needed a study uh donald trump is as a populist and so and then it's all around the world and i and i needed to study then the different quintiles the top 20 percent next 20 and so on and i saw what the pictures of the lives of the majority of people are like the bottom 60 percent um um and equal opportunity um no let's put that in perspective the those in the top 40 percent um spend on on average on their kids education five times as much money as those in the bottom sixty percent it's a self-perpetuating thing it's not a bad thing those parents care about having their kids well educated so because they do and they take care of their kids they're taking care of their kids they're getting them well educated and so on but not being well educated means you're not going to have equal opportunities and so as that gets narrower and narrower you have that phenomenon that you you know so there are a lot of ways you can measure whether there's equal opportunity if we if but i don't even know we can agree that we should have equal opportunity i mean like i i'd almost take a poll you know of the american people and see could we agree that we should have equal opportunity okay that would be an accomplishment okay then if you could do that then we say can i take measures metrics by which key performance indicators by which i could say how are we doing on the equal opportunity goal right and then and then monitor that and you say oh it's getting better or odds getting worse if we could do that we'd accomplish a lot yeah we got to get to that point first this is fascinating what would you say if you could make the decisions on three things to change moving forward with the debt crisis with the the internal wars and conflicts from from people uh and this bottom that needs to rise up what would you do if you could kind of snap your fingers um i i would say bipartisanship if i was president of the united states i would have a bipartisan cabinet to try to bring moderates from both sides because moderates from both sides together i'd have um an economic program that was put together by like a a manhattan project type of thing in which they would people from those both sides not the extremes of both sides but smart people from both sides uh would make changes i have my own changes that could uh happen but um in which um they would both increase the size of the pie and divide it uh well and when i say divide it i mean move much more toward equal opportunity in which people are productive like for example of a return on investment if you provide good education if you do that well but and i can give you many if you provide good infrastructure i like it's really uneconomic to not have um and everybody uh can not have connectivity anywhere uh you know there's certain things you could so you so i would want to have a program that increases the size of the pie and divides it well particularly to productive product productive people and those who in some way or another uh can't be productive because they're handicapped in one way or another in that productivity to provide them the assistant so you have a civil society but with still great opportunities to make do great things and you know acquire wealth and distribute wealth i mean that's it you do need it to be benefit most of the people okay you need the system so that's what i would do i would then what would happen is i'd have that middle each deal with its extremes so i think on each party there's uh you know there's an extreme there are extremists uh and now what's happening is the moderates are dropping out of the political system so because the moderates are dropping out of the political system we're getting more and more extraordinary extremists who won't won't lose they you know they'll fight to the death with each other and um laws and that so that scares me where if we were in it together and we did that in a bipartisan smart way um that you know not everybody's gonna love uh but everybody does something that would be the most important thing i would do yeah you're a wise man and uh the the third part of this if you talked about the changing world order is how really all empires rise and fall at some point and in what you call a big cycle can you explain more what this big cycle is and what part of the big cycle the usa is in and also china is in right now okay um yeah i'll describe the cycle um by an order i mean like a world order or domestic order i mean uh the system that's in place run by the people who have the the power and then they determine what the system is like and so you change orders usually by wars because you have a conflict and then okay how do you resolve the conflict they have a war so world war ii uh um ended in 1945. the united states won world war ii dominantly it became rich the richest country in the world having eighty percent of the world's money money was gold then it had world's gold and a a dominant uh military it had a monopoly on that and accounted for half the world's economy and so it was it set the rules it's the reason why the united nations is in new york and the imf in the world bank of washington dc it was the american world order because it was dominant power now when you have when you are in a dominant power also these wars are sort of great equalizers people come back from the war um it's not like some are rich and some are poor in the same way there's a restructuring and you don't have the same wealth gaps and resentments and so on and then you that usually means that you have a period of peace and prosperity peace because nobody wants to fight the dominant power and then they work together and they produce peace and prosperity and that happens and that's really um does best in the capitalist system in which capitalism capital is provided to those who have good ideas because they say we'll invest in you and you'll be productive and so on but what capitalism does at the same time is it has two uh challenges two problems is it creates wealth that um creates large wealth gaps and it also creates higher levels of indebtedness so it creates the large wealth gaps because it distributes that unequally [Music] and then that can be self-perpetuating because those who get power uh like if if you have more money you can educate your children better than if you don't the situation we're talking about in connecticut um you know those parents are not going to be able to provide the education for the kids or the benefits or that the others can't and so you gradually you lose equal opportunity and that and you produce wealth gap and you produce resentments and you also um then create larger amounts of debt quite often that means that that's a problem down the road now what happens when you become the world's largest power this is also always the case it happened with the dodge it happened with the british um that because you're so powerful on production you go all around the world and you are the largest trading country in the world you get more exports than other countries and more transactions are in your currency and so everybody uses your currency which becomes the world's reserve currency because everybody's using it and because it's the world's currency those who are those want to save in it and so different countries saving it which means that they lend to you in it and that increases your debt to foreigners because they're when they hold a bond or they hold cash in that they're uh lending it to you to get the dollars back in the future and so that is also one of the ingredients of making a top they're the wealth gaps there's that and then there's also a change in generations in generation psychology you know it's like the the story of the three generations you know from you know whatever it is from uh you know reacts to riches to rags again or something um the greatest generation in a sense of those who fought through the war appreciate basic things you know that kind of a thing and then what happens is you become when you're on top you become more expensive and quite often more decadent and what i mean by decadent i mean that you might spend on things that are are not good investments and don't last very long or whatever you know for entertainment at the sake of buying so for example in the united states i remember uh when we had a per capita income which was 40 times china's and we started borrowing from china so anyway these are the ingredients and then you start to see that they cause problems the financial problem the internal conflict problem and so on and then um the the type of fighting that we're talking about where you know some moderates say well we need to make things reform things and make them better each of is in their extreme so you classically have the populace of the left and the populace of the right who are individuals who will just fight for that side and then you come down and you have that conflict and you have that internationally as well so when you have let's say a country like the united states if you take united states percentage of world gdp or the united states is um percentage of world trade we used to be the largest uh trading exporting country in the world but china where we replace that yeah so and the gdp thing so now we have a rivalry and you have different approaches to life and then you say oh maybe you're going to have a conflict and so everybody prepares for a conflict which almost makes itself fulfilling so when you have this dynamic which we're seeing you know the world starts to split because countries want to align themselves with who's going to help them financially or militarily the ideology if you look at history is not has been as much an important determinant let's say the united states and saudi arabia have been allergized for a long time having nothing to do with uh whether the system's democratic or not it has to do with whether their interests are aligned and those are economic and and military and so we're seeing when i go around from country to country and they uh and people say okay the leaders say should i be on china's side or should i be in the united states aside whichever they say well if it's economic it on china's more important to me if it's uh military the question is will the united states uh be there when we need them to be operate that way and it's those kinds of calculations that produces the cycle that traditionally if um unless you rectify it like we all come back together again somehow and we're all good with each other ends up causing the the fight to find out who is more powerful and then it's the war or whatever and then there's a winner and a loser and a new world order begins and that's what the cycle looks like so is there is there a world where we will never have war or is it always going to be some type of war happening so that power dynamics shift and this just continues um it's so interesting um because in the mid 1600s this is interesting in the mid 1600s um there were always there was 30 years of war they called it the 30 years war in europe and they just kept you know beating the daylights out of each other and um and that is when they invented countries as we know it before then there were no boundaries um it was winner takes all it was just kind of this is a nice space it was just well yeah it was like there were no boundaries and if you want what mattered was power and if you wanted something that the other guy had you'd go get it and he'd do the same with you and there was this constant fighting about things and then in the 1600s they were fighting about religion too um you know there's the religious reformation and the others which also had to do with power because the church was powerful but anyway so they invented countries as we know it with boundaries and you determine what goes on in your borders and so on and of course we've um um and that reduced for the next hundred years there were hardly any wars interesting and um and and but they uh when the time comes um there's no universal legal system you know there's no universal policeman so if you don't have a universal legal system they've been attempts of that with the united nations or what before that the league of nations um they they attempted that but power rules and so you're gonna have tests of power it all come down to tests of power right you've come up with a template for assessing the health of a country and what leads them to success or or failure what are the main metrics that you've come up with to to assess and where's the usa at right now in that assessment um i have um i want everything that i do to not be opinionated i want everything that i do to take measurements of health so um and there were different 18 different measurements of health that you can see in the book so you could look at it as a health indicator and then you could see with those like a health indicator what does that create the next 10 years prognosis for that because if you're healthy um then you'll have a better prognosis if you're not healthy um and so there are 18 of them i won't take you through them but anybody who appears to go through through them you can see them but there are basic things like first what you're are you financially healthy do you um what's your income statement and balance sheet look like do you spend more than you earn or do you earn more than you spend are you saving what's your income statement and balance sheet look like a very big leading indicator is the relative level of education and those that have a more educated population and you could see the numbers rise you could see education levels in one country or another rise or decline in these charts so you could see how was the united states in its education and how are other countries and is that gap is it improving or worsening because education levels are very indicative of well-being and economic behavior related to education is civility civility is not so you learn education like facts and how to do calculations and things that's one type of education but you also learn how to behave with each other the civility the idea of respect and so on so you have a civilized society of behaving well that's part of it and that usually happens in the home as well as in the school system school can't do everything and there are and you could see these numbers and they're a problem okay in terms of these kinds of numbers uh civility and and we have we have challenges um as there's uh uh some often single families that are having financial problems and don't have you know those circumstances and um and so and then you have an opiate problem um you have other things that stand the one okay rule of law countries that have rule of law and respect for the law that keeps order and effectively loss of when crime rates go up its problem um a very good indicator is corruption levels there's a corruption index that countries that all countries have that you can get for every country you could see always changes and as it goes up there's a negative 52 correlation with the growth of a country and its corruption over the next 10 years okay so where's where's the usa at right now um the usa is reasonably good you know it's interesting because these are predictors of the few of the future and what you find out is like if you look at russia i'll give that as an example um it's it's blessed with the greatest natural resources of any country in the world the value of its natural resources are 40 higher than the next highest country which is the united states um and it uh does a pretty good job of having an educated population but it's cultural issues um it's not heavily indebted and and so on but it's cultural issues in terms of these things like corruption um also there are measures of um lots of measures of bureaucracy versus efficiency lots of measures of out attitude can i start a business and make my dreams happen you can see the differences between countries on just that attitude okay and also you could see it in the bureaucracy how many how long does it take to set up a business there are statistics like that so you see a bunch of them in the book sure i know when a big part of your mission is to is bridging the educational gap around economics for people and really people understanding about money how to use money effectively and just understanding in general if you could you know again i'm sharing kind of hypothetical scenarios but if you could uh share some change some things around about how we learned growing up about money two to three key things whether it be in the school system or what you wish parents knew that they would all teach children from the ages of five to fifteen what would be those three things that you wish children just knew more about around money well i i think you said it um if there was education and experience from the age of 5 to 15 that would change everything we learn differently scientists have shown prior to puberty we learn in an internal way and you'll find that a number of people um had their passion at around age 12. because that has to do with how the brain changes um but if you take that 5 to 15 and you incorporated it in the education system and the practice of saving spending and so on uh we you you know you don't need a phd in this thing um it's a the money thing is is kind of very basic you know if if i can buy it for less than i sell it that's a good thing the more volume i could do the better it is then there are fixed costs and they're variable costs so if i'm going to build a a stand a lemonade stand okay what's that going to cost me okay that's a capital expenditure okay sure it's all the same stuff that you could learn you know at those ages and and and you don't and um is there a good game i mean i feel like you should your next thing should be a game that kids can learn to play i don't know if that's the new monopoly what that is i have a son uh which is in uh his passion is edtech educational technology and and he wants me to do that with him and maybe yes i hope i hope one day please please ray please we need a gamer to make it simple you know yeah louis it ain't like i i aren't i'm not busy you know i got you i understand what will um so where is to go back to uh the us and china the big cycle where is china at in the big cycle well china's in this stage where um i've spent a lot of let me phrase it this way i spent a lot of time in china starting in 1984 not not to earn money because they didn't have any money but because i was very curious and then i got to know and like the people and i was able to help them develop their stock markets and things and and so on and that was and i like meaningful work of meeting for relationships that's my thing um and so i watch since i came since 1984 when i first started per capita income has increased by 26 times um the poverty rate by measured by hunger went from 88 to less than one percent and life expectancy increased an average of 10 years um wow so the poverty used to be at 80 percent sorry before you said it was 80 back in 84. hunger was 88 percent hunger wow hunger that type of poverty not insured a square meal um and i watched how they do that um i think that there's um and so what has happened is that they have become a roughly comparable power of the united states in some ways a bit ahead in some ways a bit behind um and so on um and that's in most things okay if you were if that list of 18 if i was going to go down that list yes and i would say okay uh do they have better educated people than we do uh well it it depends on what it almost goes it depends are we talking about public education we're talking on average do they have more whatever if you talk about a military um is that it depends is it in that region is it of that type or is it another type or something but it's comparable um if you talk about uh technology okay um when i first went to uh china i would give ten dollar calculators to people and they thought they were miracle devices wow now if you take it um in artificial intelligence and and most technologies uh there depends on the one there may be a head and some and and not so they what that means is that they've come up to be a leading competitive power there's no other competitive power like that now a lot of countries now which is scary are roughly comparable in military meaning if you have a war if we have a war with russia um it's not like the united states is militarily dominant or so in there more countries have become that way we have we spend more and we have bases in 70 countries but at the same time that means we're overextended or extended and it doesn't mean that you'd win a war if there was a war in europe um everybody would be a loser um so and there are different types of wars cyber wars as well as military wars and the like okay so um what we're now having is a situation where there is that um rivalry that could be good healthy competition however history is shown when you deal with who's going to set the rules of the game there might be disagreements and if there are disagreements how were they resolved like the trade dispute it's not like we took the both sides took it to the world trade organization and say we're going to plead our cases and then you make a decision they didn't even think about that right they go to i'm going to do this if you do this and that's that's where we are sort of so the world is breaking up into these parts where there are two sides kind of like um if you look at world war ii by way of example you know there are um the allied powers and the axis powers and then they're in europe or at indonesia and they're different alliances in europe than there are in asia because each has their own interests and it's developing that way so when you take the ukraine and you look at the ukraine and and that that's more aligned with the other side let's call it the access powers which are the challengers um to the united states and to some extent the euro nato powers and you have that conflict and you could see in a number of statistics or actions how the sides are lining up like for example um when they you they just ask are you going to apply the sanctions or not are you going to do this and that in the united nations did you vote against russia or not and so on and you could see all those things and you could see how the sides line up for example um india lined up with russia um and so you could see how this is lining up and you could see that we're coming into this um there's no conversations and communications that's even polite between the two countries right now and those things and and that's where we are and and if you look at history um that's a dangerous place to be i'm curious about the mindset of making money and there's a massive wealth gap there are people that who are making money and some that seem to be making more and more money and others that are always seem to be stuck in the ability to make money to save money to invest money they always seem kind of trapped in not making it what would you say is the mindset that wealthy people have around making it and growing their money for them versus the mindset of people that stay stuck in not making it well i i want to distinguish there's big differences in opportunities yes so let's say supposing you have two people of comparable opportunities yes and then they were going to do that okay the marshmallow test yeah as you as you know apparently is you take a kid and you say okay uh you can have one marshmallow now or you could have two marshmallows in 15 minutes if you don't eat the first one yeah if you don't eat the first one right yep okay once you start to realize that deferred gratification is going to make you better and so on and you start to count count and you say like something like how many days weeks months or years can i live if i don't have money come in and you start to focus in on that that's the first step okay like the marshmallow test okay so i want to save you got to start there then if you do that you're necessarily going to go save in what and then you'll start to get exposure to how these things are different okay then you start to care once you have one of these and one of those and you start to experience and then you start to learn and basically that's what makes the difference that's it the so first having the ability to have delayed gratification then obviously diving in researching testing and and trying different things but the more and more you can say you don't want something now for greater later is the essential key well and what it does then when it comes to the money that means money yeah now at that moment that you don't want it you have savings that means i want savings right okay now you got savings so the next thing inevitably that's going to come at you is where do i put it and then you get your choices and then you experience it and you learn right yeah because there's lots of place to put it for investments there's real estate there's stocks there's building your own company there's different places to invest what have you found are the top places that people should be investing well i think first you you start with what are the most important things that you're closest to like is it your business first calculate how many days weeks months or years you can live on your saving because when you do that you'll start to you'll gain security you'll gain that okay so look at how much you're spending okay and then say how much do i need and whatever that number is you're going to need more than that because it may go down rather than go up so okay now do i have a year spending okay you so i think i think you you start there then you start to think um what are the things that are most important for me like and then you start with your your business or your residents that have a symbiotic relationship and that you know well let's say if you start with your business okay you're closer to that investing in yourself with whatever that may end up being that may be your best investment not not real estate not stocks not the market well it depends if you're if you're not you know if you're doing something where you can do it yourself and that's the thing but if you're in a job and and that that's not the thing right because you because you're in a different position okay but anyway if you and then i i really think there's something good about your home a basic thing about your home because uh it's nice forced savings and it also means that you you fix it up you you know you're saving you find out there's oh well if i add this thing or that thing and you're enjoying it so when you're enjoying it and you're controlling it and it's yours and so on uh that's that's pretty good and if you know if they keep mortgage tax deductions and so on you know there might be some benefits to it also okay but that's not a black and white answer you know so you could take a short pencil and say is it better to rent or buy okay that's a different question maybe i said but by and large am i going to move you know all of those other questions but so when you start with okay what is it that's close to home and how much you need a certain amount that's liquid in other words you got it in your house you got to make a mortgage payment or something and all of a sudden you're uh you know you know it's not liquid and you lose your job well that can cause you trouble so how much do i have that's liquid how much do i have that's not liquid okay and you start to get those things right okay ah i've got enough liquid i got enough okay not liquid and those other things okay pretty soon you're you're getting yourself in good shape yeah you do those things you know you're pretty much in good shape and then you're also having some experiences and then you go beyond that you know and then so you start to okay what you know okay what's a stock what's a bond and then you know you learn from experiences i i learned through my my experiences i started when i was uh a kid 12 i used to caddy and i took my caddying money and i put it in the stock market and i was lucky what happened to me by by the way is i took my catting money and um i bought the only company that i ever heard of that was selling for less than five dollars a share and i thought that that you know well i was really dumb i thought um i'll buy more shares so if it goes up i'll make more money uh and it was the only company it was a company that was about to go broke but somebody some other company acquired it and it tripled and i thought ah there's an easy game and i like it easy money so but you know you experiment and you learn can we start with kind of this first principle that you've been talking about and what we should be aware of that's coming sure um uh to put that in context uh before we get into the cash part um yeah i'm i'm a global macro investor and um economics markets and politics and geopolitics all matter uh and there were three things that are happening you pointed them out three things that are happening in our lifetimes that never happen in my lifetime or our lifetimes and that i learned before i have to study um past periods and those three things as you point out are the creation a lot of debt and money um the second is the amount of internal conflict that we're having over money and values and what that's like and the third is the changing world order with um countries like china and russia competing with the united states in a way that didn't exist before so back to the point that you're making about that money it's a basic thing um there everybody agrees we need more money and we need more spending uh but if you spend more than you earn uh you have to borrow and that creates debt but that at first it's credit so it gives you buying power right but it you have to pay it back and that becomes depressing and so in order to avoid that central banks can print money and buy it back right but when they do that that depreciates the value of money so what we had was a lot of money and credit go out to a lot of people a lot of buying power everybody when they got it they thought oh that's great and somehow they seem surprised that when they spend it the prices of everything go up okay but the truth is that if you divide the amount of money and credit that's used for spending by the quantity of goods produced you can calculate how the prices will change and so that's what's going on and that's what went on in a giant wave the federal reserve and the government together a giant wage and that produced a giant amount of inflation a giant amount of inflation is it eight and a half percent right now is that what it is yeah well it depends i mean if you it depends which number you're using it's um between seven and a half if you use euro over a year or if you take um the core inflation rate it's closer to 12 um and it's uh and and it's rising there's some temporary influence but it's basically because of the amount of spending you can measure the amount of spending not because of the bottlenecks and for people that maybe are hearing this inflation and have been hearing this recently before we finish the first point for a lot of people when i grew up i never understood what inflation even meant they didn't teach this to me in school they weren't teaching this in high school college there really wasn't a thing that i learned i just heard it and knew that people were worried about the cost of things increasing can you explain what that actually means to us for someone who's making 70 000 a year in the midwest what does that mean well to them um buying power is what matters right and so what happens is when inflation goes up faster than your other sources of income you lose buying power okay uh but what happens is somehow that seems uh more acceptable sometimes to people uh than if it was just taken out of your pocket you see if they let's say raise taxes or take it out of somebody's pocket everybody complains whoever's had the pocket taken out of um but if you're uh if it comes through printing of money and everybody gets checks it's more acceptable but what happens is those who are holding money like money market funds and bond funds um lose the buying power of that so think about those bond funds those bond funds are like down about ten percent and inflation is up over let's call it eight percent so they lost 18 of the buying power so it releases it relieves debt we think of it as meaning higher prices but to some extent that's a rich man's perspective because they say oh now i have to pay more but the reality is you don't get more stuff from that higher inflation and so it bids it out of the hands of some people and that that hurts the people who are you know who don't get it because it's really but you know so that's what's going on you lose buying power and so we're seeing a time now where you're going to lose buying power to inflation and now you're going to see the federal reserve also tighten money tighten money and credit and raise interest rates and when they do that that creates less buying power because when they um you know they say okay now you can't spend as much money and the prices are going high but they do that in their crude way of trying to reduce inflation but you get it from both ends the higher prices and then the higher interest rates you have to pay and also and higher debt service costs and also less availability of money so it's a squeeze like the squeeze that happened in the 1970s so does that mean i mean if someone is hearing this and they're thinking okay inflation's going up the buying power is going down it's a squeeze is this going to happen for five years ten years is it eventually going to level out what should we be expecting do you think these things go um in paradigm shifts that quite often take a you know relatively long time because everybody's mindset is in a in a paradigm shift everybody's mindset is in a certain place and they're doing certain things for example uh investors think that cash is safe and they don't pay much attention to inflation and then what happens is they get inflation and they realize that if i'm holding cash i'm losing buying power so then they shift they sell out their cash or they sell out their bonds and they put that into other things and when they do that that also contributes to inflation changes like that also happen in a lot of ways like um cost of living increases in in compensation you know where in the past when they don't worry about inflation um then they don't think about um do i have an inflation linked uh contract for my work or do i have enough inflation assets it might be i oh do i need to buy i'm gonna store my money in a house or i might store my things and so that pendulum swing from one mindset and one positioning to another mindset and another positioning in the early stages tends to be self-reinforcing those actions produce more inflation and more inflation psychology until that goes to the opposite extreme you know like in the 1970s that people were surprised about what happened because they weren't used to inflation much then you had the inflation and in the beginning it swung and then at the end of it they said inflation will never end and everybody's position for it never ending and then of course what happens is it's so bad that then the central bank goes the opposite extreme and then they get surprised and so the 80s was a period which was the exact opposite of the 70s where you have falling inflation high real interest rates and so on and so the worst assets to own in the 70s were bonds and the best assets to own in the 80s were bonds so you see these pendulum swings that way so what would you say are the best assets to own in this decade well um the best assets to not own that's the most important thing i think is is cash and quoted cash is trash um there will be a tightening here for the time being and that tightening will have an effect it'll it'll hurt asset prices and so on um but uh cash is not the acetone um and and bonds are not um good tone in my opinion because it's debt it's owning somebody's debt and you won't get a return think of it the interest rate will not reach the inflation rate so that's the problem so you'll have that award then what you have to have i think most importantly is a well-diversified portfolio of other assets diversification is a very powerful tool because it can reduce risks without reducing expected returns now there's lots of ways of getting what you think good investments are they might be things you know about and the local businesses and so on or they might be uh stocks and or they could be maybe a little gold or maybe a little bit foreign investing diversification is very important to do that in a balanced way so um i would generally say that that would be what i would recommend curious what's the greatest gift a rich person or someone with money can give someone who doesn't have money to give the knowledge uh teach a man how to fish is better than to give him a fish i mean i think you can give them both you can give education and you can show but uh ability the the capacity to be productive because you know if i can give you the capacity to go out in the world it's like go into a jungle i give you a knife and can you live in the jungle okay if i give you that capacity that's the best thing i can give you that's why i wrote the book and you know pass it on i wrote those principles over years and i wrote them down and that's what i want to pass along that's the most important thing yeah but but if you but if you've got money you can help people uh a lot in a lot of different ways which is thrilling what would you say then are the three greatest skills that people that aren't financially abundant or that are struggling financially should learn to master in order to be in a better position financially three skills what would you say they should learn well as i said before i remember watching the movie i was young david copperfield with wc fields and he speaks to david copperfield and he says he said something like and i'll put it in dollar terms you're in a hundred dollars and you spend 105 dollars that's misery if you earn a hundred dollars and you spend 95 dollars you'll have a good life i mean what wasn't exactly like that but it was but but basically i know so many people who don't earn much but are there because if you start to think about what it is that it costs you to live in terms of let's say the basics you know uh give me a bit to sleep and give me the food let me be educated and so on so forth i think most people can get themselves in a position where you know they're net positive so if you can be net positive and you could do that that you know that's number one you know as i carry that so that's you know that's number one then i guess it was the list that we went to you know the second is you know what do you do next in terms of what do you need what do you invest in you know and then and then you know going beyond it and then there avoid the following mistake the most common mistake of investing thinking that the investment that did good is a good investment people rather more expensive the things that quite often those markets that did really really well became more more expensive and everybody smart money is all the time compete comparing them and competing so what happens is um the naive money buys the thing that was hot or is hot the thing that has been terrible which might be the thing that's beaten down so i would say also an important element okay so here's another one that's really important diversify so don't put all your eggs in one basket right because what i learned about this is that first of all all investments uh compete and it's not easy to sell tell whether one investment's better than the other because if people could do that life would be easy and everybody make a ton of money um so and this is a competitive game that's very difficult to compete in so it's very difficult to say which one's better or worse you could take experts and you could and do all sorts of tests and you'll find out that they can pick that and you can't tell whether the worst ones are going to be better so because of that you understand that um even picking the best ones is difficult and particularly if you're naive like we spend hundreds of millions of dollars each year on research to try to give us an edge okay now you've got to compete with us so uh competing in the markets is more difficult than competing in the olympics you wouldn't go think i'm going to compete in the olympics but there are more people who try harder in order to do that so it's a zero-sum game so but diversification um that they're different uh will reduce your risk without uh reducing your return yeah so if you know how to diversify well so um that's critical so i would say again uh get get your savings right and the reasons i say i would say um have great humility about what you what you don't know don't buy the thing that was hot just because you think it's hot um and then know how to diversify well that those would be the most important things i could convey i love that you talk about the in the sports analogy the olympics you're speaking my language now as a former football player some of the greatest quarterbacks seem to get not too high there's they get excited but not too excited and not too low uh when things go good or bad how important is that skill to be emotionally resilient on both levels high and low for you how important is that skill it is one of the most important things possible and it's not easy to do um so i needed to uh you know do two things um i found that by writing down my principles and the rules and then testing how they would have performed over time and that's where the algorithms came so that i can basically just like a machine play it click click click click click okay with execute the game plan you know don't do it oh because i know what the experience is like the experience is like you're wrestling around with it you're losing money the day you put on a trade it doesn't go either straight up or straight down and goes against you so now i don't know you're losing money okay how how much should you lose what's your game plan you've got to know your game plan and stick to the game plan and you can't be shaken out and yet um the emotions are going to cause you to doubt yourself and plus it brings you stress all of that so you have to execute a game plan that's very well thought out right um then over time you start to develop some better instincts like if you're excited and you're going along be scared you know if you're if you're doing something you're really worried about and and nobody else is doing it maybe good don't be dissuaded see the markets are very different than consensus decision making it's counter consensus because the consensus is built into the price right so if everybody loves something it's expensive and if everybody hates something it's cheap so where most people say ah this is like oh what a great company okay amazon is a great company we got amazon's a great company who doesn't got that amazon's a great company okay and then okay i'm gonna go on amazon okay but if everybody's got that it's it's a great company and it it becomes increment less great than they anticipated bam that baby goes down so you have to um start to develop some of those instincts or a game plan and what what financial advice would you give to millennials who who don't have these these tools yet besides obviously getting your book and starting to practice some of these things but i feel like millennials are overspending more than ever they're uneducated on finances and personal finances what what advice would you have there pay attention to the feedback you get from the realities you encounter yeah okay i mean you know pain plus reflection you will get the pain pay attention to it listen to it because you're gonna get the pain is now the time to start investing or is it more just save up some reserves for six months to have some cash to live your life before you start investing or is it important to build the discipline in the habit of investing 50 bucks a month 100 bucks a month in a diversified portfolio no matter how much you're making i i i remember going through this because i i didn't have any money and i when when was this right oh um this was um 1982-83 uh i didn't i had to borrow four thousand dollars for my dad to help to take care of my family bills uh so um but i so i remember thinking um how many weeks could i live if i lost my income and i started counting in weeks and i would try to go out because if i got hit i so i think i think that's the way to do it you know you start to count uh how many weeks can it be a month can a year can i get up to a year i didn't like that because of the fact that there's an obligation and it's like oh if i get then i'm going to be drowning i'm trying to keep my head against water this is just my own bias but anyway count the how many you can um and then assume that it's buying power over the next number of years can fall by three or four percent a year or or if or if you put it in a risky investment it like stocks or something it could probably buy more so cut that number maybe in half and have twice as much because you have to understand that that's your freedom that is your safety so that first band you must take care of that first band take care of that once you get past that and you feel okay i could take care of my family and i could take care of mine in a worst case scenario then you have the freedom to then take other kinds of risks but when you're building that portfolio um it's the same thing as when you have a lot of portfolio past that just you want to diversify well because you could see what happens to the to the markets every market stock market bond market most markets have had times where they've gone down um over an extended period 60 or 70 percent so in buying power so i think diversify count that and build it and realize that your um that's your saving i one thing i do for my um for my kids and grandkids and always did uh as long as i could start to afford it uh was um for every uh holiday like christmas or their birthday i would give them a gold coin and i said i never want you to sell that gold coin until uh there's an emergency a real emergency never because you want to buy things and the reason i did that and they'll build over a period of time that'll that'll build something and i said don't even sell it you pass it to your kids unless there's an emergency okay and so you're building that savings because i think we um so easily spend so much money on junk you know so anything that i would give them whatever it would be i don't know a piece of clothing a p a a a thingamajig a toy or something right right we'll probably be gone in a year yeah okay and so the power of staving and you know and that resource the relief it gives you and the power it gives you is so great so yes save it diversify it i'm gonna i'm gonna continue to stay on this topic but also go off a little bit because you mentioned how i guess it was 40 years ago you you lost your money and you had to borrow 4 000 from your father to just kind of survive and pay your bills how much money had you built before then before losing it um i don't remember it it wasn't like it was a ton you know i was early fairly early in my career i had a small investment business um i don't remember what it was exactly but uh it was it wasn't a time i'm curious how you from having some money uh to losing it how you then went on a 40-year four-decade run of getting to where you're at now was there something in your mindset that allowed you to believe in yourself still yeah okay that didn't say oh i've lost it all out you know i i don't believe in myself anymore because i just ruined my finances that extremely painful uh experience was probably the best experience of my life really and um it changed my way of thinking ways i'll describe but let me let me say before that i didn't have much money my um my dad was a jazz musician my mom was a stay-at-home mom um and uh i i felt of course rich i had two parents who loved me i went to public school but and then when i was a kid i i i did odd jobs and i caddied and so when i put in the stock market when i was 12 and i got hooked on the game so i never had much money uh but then i built up some and then had that experience and and so that experience and which was also a very public experience um um was very painful but it it it changed my approach um to decision making in really a profound way um first um it gave me the humility and fear of being wrong that um balance my audacity um to double check myself and in fact try to find the smartest people i could who disagreed with me to have them stress test my thinking so i'm never sure if i'm right like my track record of being right is probably 70 or 75 ish somewhere in that 70 percent let's say something like that and i'm i'm used to being wrong sometimes and uh and and it's painful so the stress testing of my opinions um gave me an open-mindedness to learn a lot um and um also uh diversification i learned how to diversify without reducing my risks if i could take a lot of uncorrelated bets the return will equal the average of those bets but the risk can be up to 80 percent less and it changed my it really caused me to reflect because i remember thinking to myself it felt like um i was sitting next to a jungle and i could sit on the safe side there's always risk in return and um and what would i do would i have a less great upside and be safe or would i go through crossing this jungle and which things could kill me or whatever in an attempt to have a great upside a great a great life a great upside and so that puzzle um led me to do the things i'd described but also um i knew that i had to go have the great upside and not be constrained by the risk and uh so i did the two things that i've described but going into the puzzle i found that uh it was great that to find people who could see things that i couldn't see and vice versa so that we were on the mission together because people see things differently i learned how people see things differently somebody will spot this or that and then that back and forth helps you make better decisions and if you're on the same mission with them so one of the things i wanted was this meaningful work of meaningful relationships and i found that that was so good that when i you know sort of got to the other side like you know i had enough money and upside or whatever i still wanted to stay in the jungle and i still wanted to do this because the act of of of doing that with people that i was doing this meaningful work and meaningful relationships with was rewarding in and of itself as well as success so one of the things that you can learn is that you can see through other people's eyes that doesn't mean you accept what they say blindly it's that you think about their reasoning and if you do that that's good it also gave me a principle which is like one of my fundamental principles which is pain plus reflection equals progress okay we have this pain whatever it is and okay the reaction is a negative reaction and could almost be why did that thing happen to me and and so on uh if instead when one calms down from the pain there are is a lesson there about how reality works okay it happened it reality works that way and then um there's a thought how do i deal with it better right to produce better what's my lesson and if you acquire that i used to acquire i would acquire that i still acquire that and then i wrote them down as principles in my books that's why the collection of principles it's like a journal direct pain plus reflection equals that and and then you write down the principle like a and that's what the collection of principles came from that has so that event that painful event was the basis of going from you know where i was which was broke um to you know where things uh where i am and when i'm transpired which is trying to pass along my wealth and and my advice to others now the greatest relationship in your life who has that been for you the person in your life who's made the biggest impact well my wife she's been a partner for 43 years you know so at all dimensions you know i love her um intellectually spiritually physically in all all dimensions and so and we share the most important things you know uh everything from the children and the grandchildren to excitements of life so uh without a doubt uh it would be her yeah and you you write the book in her honor which i saw in the beginning i'm curious what's the greatest lesson she's taught you about becoming a better man and a better business leader well i i i get to see the world through her eyes you know and and through her heart so she shows me so many things i would say it you know through all the years it's been many many many different things right now um she's in the process of over the last 10 years of helping the poorest most disadvantaged kids in bad neighborhoods in in high school to try to get them through high school and so on and so she's given me a window into uh a different world that has been helpful uh but it's uh you know it's everything it's spirituality it's uh you know different places in the world it's um so many things that's beautiful uh you've seen a lot of pain in your lifetime maybe maybe personally you've experienced somebody just in the world from the different pains that have happened in the world whether it be the economy or uh injustice different things that happened death you've seen a lot of loss just in general in life and you talk about how pain plus reflection equals progress i'm curious it seems like there always needs to be some type of breakdown in order for people to be able to look back and ask themselves okay what's working what's not working what do i really want and how do i get there do you think it's possible to have progress without some type of pain in our individual lives well pain is a heck of a teacher by comparison i mean you know like when when you get the pleasure uh then you then you just keep doing what you're doing but it doesn't teach you to change you know pain when you put your hand on a hot stove or do anything that uh got you into a position teaches you maybe about how to approach it differently and also uh pain teaches you about how reality works reality is reality we're given reality a lot of people say they want to fight what reality is uh you know oh it's what was me and stop thinking about it being differently just understand like why did that thing happen to me and how do i put it in perspective it's like nature does it doesn't care about you right it cares about the you know the universe and so when you have those experiences just understand how reality works and also how to approach it better that's smart i think so i think pain is the best teacher what do you think has been the greatest pain in your lifetime that you had to learn a lesson from well of course um the greatest pains are losing people that i love the most which then gets me to reflect on the arc of life right and what it's all like but um things in terms of i've come differently i i remember a case that changed me profoundly to tell you the story quickly so i started my business in 1975 investing and it's you know it's easy to be wrong in investing that's part of the game um but in 1980 81 i calculated that american banks had lent a lot more money to countries than those countries were going to be able to pay back and that they would therefore have a big debt to fault and that would cause an economic crisis and um it got a lot of attention because it was a uh controversial view um and then in mexico defaulted in august 1982 so that prediction sort of wow came right and some countries did and i got a lot more attention because of that was right and i thought we were going to go into an economic um spiral a depression a big debt crisis and i couldn't have been more wrong and um i i was exact that was the exact bottom in the stock market yeah and i lost money i lost money for myself i lost money for my clients i had to let everybody in my company go and i had to i was so broke i had to borrow four thousand dollars for my dad wow pay some of my family bills so i mean i was it it was a lot of pain this was 82 yeah so you're broke then 82. broke totally no money no money no wow and that was one of the best things that ever happened to me it was very painful but it was one of the best things for because it gave me uh the fear of being wrong without me losing my audacity in other words um it gave me an open-mindedness it made me start to think um what how do i deal with what i don't know so i it made me find the smartest people i could find who disagreed with me to start to understand their thinking it made me think about how i could maintain that that upside you know risk goes with return so i didn't want to uh have an ordinary life mm-hmm so i still wanted the big upside return but how could i do that without less results that's right and i so that was a problem that that was part of my reflection and that reflection led me to understand how i could diversify better how i could stress test my thinking better and so on then i brought in the smartest people i could find who were independent thinkers who would disagree with me and then i and and and i did that and that was the exact bottom financially and so on in my life from that point up to um you know not long ago fortune described bridgewater as the fifth most important country private company in the country in the u.s and so it was that pain and reflecting well on that pain that gave me a greater ability to deal with what i don't know and i learned this is an important thing to learn that i learned that uh whatever success i had came more from my knowing how to deal with my not knowing than from anything i knew in other words what you know in your head is only a small percentage of what the important things and the right things to know is and so to be able to go outside of one's head and to take in the best of the best of the best wherever it comes and then use that to make decisions and all of that came from that painful very painful mistake where do you think you'd be today if in 82 you didn't go broke and have that massive pain i'm sure i'd have a you know a very uh ordinary i don't know life i don't know you know because i wouldn't have known how to have great upside while having acceptable risks right in other words like like i at the time i reflected it i i felt it was like like the following i'm on one side of a jungle and i'm on this one side of a jungle and uh and you could go in order to imagine you could have great success if you can cross the jungle alive to get to the other side but in the jungle are all sorts of terrible things that could kill you and and so on and you have a choice you can have this bore boring or you could have this ordinary life or you can try to cross the jungle now each one of us would approach that differently for me i had to have the greatest life i could have so i had and i have a little bit of a taste of adventure so how would you cross that jungle and what i learned was that the best way to cross that jungle would be with a team of people people who i cared about they cared about with me who could see things that i couldn't see and i could see things that they couldn't see and that way you could be effective together and when i and so that's what i did that's how it worked and what i also learned through that thing is like i don't want to get out of the jungle i don't want to get to the other side because the actual act of being in it with them and to do those things is itself rewarding so i i'm i'm confident that i wouldn't have learned that if i didn't have that kind of experience so you're still in the jungle today yeah i'm in my but my jungle all everyone's jungle um is a life arc there's a life arc right um you have to recognize the life arc you know zero to i don't know 80 85 or something is the life arc um something like that i'm 71 i know where i am on that journey okay it's important to know where are you on your journey and then when you start to think about that like where will i be in 10 years i'm going to be a different person in 10 years okay where will the people i love be think about yourself where will you be in 10 years and where will the people you love be it could be your kids it could be your parents where will they be and what will their experiences and the journey that they're going through and you're going through and this script in the journey by the way is is is pretty well known right like um i think i'll give you example i think it comes kind of in three phases uh the first phase is when you're dependent on others and you know you're learning okay then what happens is you get out of school and you become independent and you go to work and then it's entirely different you're in the second phase of your life when others are dependent on you and you're working and you're trying to be successful and then you and and but there are the arcs and you could see it the markers along those lines you know do you get married when do you have a kid when like i i realized like when my kids have kids i'm now in my third phase okay so so you see these things you know yeah and so you have to see that so what i want at this phase of my life at 71 i'm in tr in transition from my second phase in which i've uh worked and i've won and i've you know i played you know it's like had my battles and it was great and so on and now i'm in a mission to pass along the things that were valuable to me i want to pass them along to others and then i'm going to go quiet and then i'm in that other phase you know but you learn things and so this is kind of a mentor pass it a long phase how do you stay confident in transition from kind of one identity to a new identity that's something new that's something unknown whether it be in your personal transition life or in the financial world where things are unknown things are transitioning or it might seem like it how do you personally stay confident in the transition first of all you're really talking about comfort with ambiguity yeah okay um and the way uh the way that i feel it is uh life is like an adventure i mean if you knew everything it wouldn't be nearly as good right and so the ambiguity is part of it it's part of the game it's just the way it is and then so to then experience that and and and to know how to deal with ambiguity because the same rules apply you know feel it feel it what's it like how does it feel where are the pulls to how do you learn how do you learn how to approach it what's it like speak to others who have been in there in that spot before um you know taste it and so on our preferences change you know as you're going through all those things so you feel it out you learn about it you go to the things that you feel the pull toward i'm curious you have your your feelings you've been talking about for a few moments but i know you're a very thoughtful human being you create algorithms for your entire work your team everything is based on algorithms kind of thoughts and ideas but i'm hearing you say you're a deep feeler as well are you would you say you're more led by thoughts or your feelings and i think it's the alignment of them okay here's the facts of pertaining them there is a subliminal mind that we have and there's a conscious mind freud discovered that there's a subliminal mind so we have and in that subliminal mind um we we just don't see it because you know because it's not conscious but it it has a big effect and so feelings and those things are coming through that subliminal mind and it really has a big control and then there's a conscious logical mind so they for everybody and so they're in your mind they're like everybody's mind they're these kind of two minds that are working now i i find that when i align them meditation has had a big effect on me i've been meditating since uh 1969. wow so so for a long time because what that does literally it's an exercise where you repeat a mantra sound and then you lose sort of a consciousness and you go into the subconscious mind but in any case to reconcile feelings with thoughts to recognize feelings with logic and align them like each has to double check for me like if my feelings i'm yes i'm a big feeling person the the most important things in life for me are what inspiration love um you know what what is it about i mean what are you doing it for but at the same time to be able to get their logic and be able to express oneself and and you know in algorithms or so is it is a good thing so when they're aligned it's kind of a double check and it works at both levels so i think that's most important when you doubt a decision or maybe just a moment in your life personal or business related doesn't matter when you when you're in doubt of something what is your personal mantra to get you back to a kind of a centered aligned place where you can make a better decisions well um on the doubts you know the question is always like how big of a deal is it and what is this type of bed and so on and yeah you know little doubts no okay that's no big thing um you know life and death decisions uh those kinds of things they're big you know those are the big questions um and what i um what i realize um on those is um a doubting is part of that process you can only be sure a certain amount how do you get to the best triangulation in other words take in from the smartest people and your own thoughts and so on so that you're making that understand how reality works and then try to make sure that none of your um decisions are the ones that knock you out of the game in other words like i've got an expression for people who uh who work for me you can scratch the car but you can't total the car you know you could so realize okay you don't win it all you you know you you make your best bets but don't have the one so you have to eliminate the the killer ones because you have enough killer ones um and one and odds are one of them's going to get you right so so you know i approach it basically uh that way you know try to make the diversification try not to have any killer eliminate all of those that are unacceptable and then go for the upside and and doubt but you know i'm used to doubt i doubt you know there's there's everything every time you put on a position in the markets for example i am never sure if it would be easy if i knew so there's a lot of doubt right so so doubt is part of it but yeah you know don't have don't put yourself in a position that you can have unacceptable where you go bro hanged around a little bit is okay yeah right so how do you have confidence when you're doubting yourself and you're like i think this is gonna do well based on all the math and historical evidence and feelings how do you have confidence when you you know place that bet i have enough bets that uh i make the bet so that none no one of them i i won't allow anyone that'll kill me and then i raise and i'll typically only want to make bets that i feel good about and i will have them stress tested my bets by having other people stress testing so yeah just imagine i don't know you're playing a chess game okay now okay maybe you're a chess master but okay what are you gonna do you have to still make a move so okay what's the best thing to do now imagine you could ask the best chess masters in the world what you do and think about the pros and cons and make your decision and and just not make it that also one's going to knock out of the game so it's that i think that there take our three things i think that there's better than an even chance of a bad stagflation very bad stagflation because of the dynamics i think i'll say one and three chance but i think it's actually probably higher than that that we have a type of civil war internal conflict really in which let me the rules are not followed the compromises are not made that maybe um the those who they fight they don't accept losing an election that there's movement of people to different states that they believe represent them better and there's a polarity developing and they're going to different states and that there's not obeying the central government so now it becomes a power i game i don't think that to be object i'm in the business i need to be objective right because accuracy is my thing i have to be as accurate as possible i'm not saying that's accurate but i'm saying when i look at that i don't think uh my assuming that's a one and three i think it's actually probably higher than that that there will be that kind of a situation and i think it's better than um higher than a one and three i think maybe significantly higher that you get into the same conflict and the power for example um internationally for example um does russia or the west win the war in the ukraine i'll define uh putin winning the war as uh three things he controls against control of the eastern part of the ukraine russia's economy is not devastated by sanctions and he remains in power wow and and let's say for example he can attend and russia attends the next g20 meeting okay so that's him winning the war that that for him that's him winning the war because in the beginning of that um it was worth his cost i mean he wants more than that he wants a neutral new cr ukraine or an aligned new ukraine um but he pro he's not gonna probably go and get that so he but that's the minimum now that's him winning the world that's also kind of the west losing the war now but if he loses the war if he loses that he will probably escalate okay because the war is now pla being played as a um on the ground armies armies um and with sanctions but he has other weapons and rather than go down he will probably escalate okay that's a game of chicken but it's a very dangerous game yeah um okay um and there are other issues globally for example you're seeing these alliances work out and and you're seeing the united states uh for various reasons um sort of pull out of the middle east um and you're you're seeing china more move in and so these tensions exist and power exists are more countries that have nuclear weapons now than there were and uh you know there's there's even talk of uh joint military operations between china and iran um and so you see these sides begin to align so if i say that there's a one in three chance of um some kind of a military confrontation that scares the hell out of us over that is extremely i don't think that sounds too high i think it's larger than that so that means i think um we're headed for some risky times because you because any one of those things is really is is not normal and one of those things is not what we're used to it's pretty bad but again i mean if you if you if everybody worries they don't have to worry um you know if both sides think about what that's like and say i can't you know we must come together and make sure that that does not happen yeah that would take us being rational human beings right and having some inner wisdom and and consciousness well that's one of the reasons i'm trying to pass along you know i passed along the book which was a study for my own benefit but i also did a uh an animation and uh um to try to pass it along so sort of help people understand this the animation i put it out a month ago it's got 11 million views people it's very digestible yeah so um you will have that we'll have that linked up in our description on audio and on youtube for people to watch it's really powerful um i'm curious you're again you've you've seen a lot in the last four or five decades of being in this this industry and this business and in the financial world um with everything that's happened over the last couple years not just pandemic but stock markets going up and down wars inner conflict of countries all these different things cryptocurrencies coming in the decentralization of money all these different things what do you even think is going to happen in the next 10 years with with the whole 2030 agenda being talked about you know what do you see happening over the next 10 years um i should say that one thing i uh when i did that i discovered the three forces that i mentioned i discovered um a fourth and a fifth that are very important and big um one is that interestingly acts of nature in the form of droughts floods and pandemics have had a bigger impact than the things i've i've been talking about um in terms of cost more lives or um toppled more civilizations um those acts of nature um so i think um um that's something apparently that we have to be concerned about um but number five over long periods of time 10 15 20 30 years the most powerful force is man's ability to adapt and invent tremendous capability of adapting and inventing so you'll see charts in the book and you'll see here's a great depression and here's a war and as you see those things they look like blips on the chart of life expectancy per capita income and so on and so there's a tremendous capacity for dealing with all the other stuff if man can adapt to it well and and inventiveness during this period of time um should be kind of i think really great because what we're using more and more is types of technology artificial intelligence and so on the ability to think and collect data and use the computer to help us with that is a very very powerful force now like any forces it's also a risky force because it can be used for bad as well as for good um but i i think the world will evolve we will have these cycles in the world so that's what you see uh you see these cycles and then you see um evolution through those cycles and adaptation um and so i expect that but i would say um there's the probabilities i gave you before um you know that concern me um so you know a lot will be unknown but i'm you know we have a lot of potential and a lot a lot of things to worry about you've created so much wealth for yourself you've been building so much and you're still very busy it's not like you're you're done by any means you're still growing but if you were your late 30s early 40s at this time and you had been building a business and building a team and trying to set yourself up to be healthy in all the different areas of your life how would you be thinking if you're in your 30s early 40s about the next few moves that you should make as an individual oh it's very interesting because uh there's a life cycle um and um i won't but the upshot of the life cycle is in your early years your quite often your happiest years and the happiest years extend uh just until you uh a bit past uh you getting uh out of school so there's three phases the first phase is you're dependent on others um you're trying to learn and be successful and then you come out of school and you're i um idealistic you can do everything you don't have much obligations you take on the job and so on that's a happy period the um then you have a work-life balance challenge and more and life is harder than you expect it to be typically um and that notion that i'm going to be just easily terrifically successful is difficult and so if you take the most least happy period of life by measures of happiness across most societies um it comes in uh really something like the 45 to 50 5 50 period um that's because you have the work life balance maybe the relationship that you had with your spouse is not or whatever your significant other isn't as wonderful as you'd imagined it would be that's when the divorce rates are higher you're overstretched you're having to take care of your kids and you're having to take care of your parents uh it's it's a tough phase um that's that's a tough phase and then what happens is as you pass that it's very interesting um from 55 until um the person approaches whatever that is that's going to kill them is the happiest period of time um even happier than the earlier period of time by records because you become free you're not so hung up on am i the best accomplishment i'm i'm okay you're so sufficient you have you have the choices whatever and you don't have to take care of your parents you don't have to take care of your kids the kids are grown up and uh your parents have passed away and so on so that's the pattern um and so when you think about uh this in terms of let's say your question um okay what's the advice my first bit of advice is uh meditate i found that meditation i do transcendental meditation i find that uh that gives me a calmness and an equanimity to deal with my realities that are coming at me okay life is just a matter of choices and um i found generally speaking when things are at odds and there's this conflict if you step back with a clear head you can um get most of each that you think is at odds for example um on this work life balance most people think well do i do i take more uh free time and take it away from work or do i take work and take it away from the free time and so on uh but the real answer to the question is how am i going to be efficient so i get more out of a day or more of an hour and if you're with equanimity you look at your circumstances and you say okay how can i get more then you can put more life into life because you you reduce that but you have to have that equanimity not a sense that stress and these things are happening to me and i'm angry and i'm upset okay because that will hurt you physically stress is a killer and it also won't make your best decisions so i'm i'm trying to give an equanimity uh you know and again pain plus reflection equals progress reflection quality reflection not just yourself but even asking people and looking for principles of other people who are in that same situation it's not like this is the first time you've gone through this or anybody's gone through it so when you ask others well how do you deal with work life balance or or other things you you you know um you'll find interesting things and and you'll be able to deal with it okay so meditation would be one thing and that equanimity and look at it and realize it's just your choices it's not the world picking on you but but you know it's the world it's like well it's happening it's reality yeah and you know that kind of a it's an approach to life yeah were you always a meditator i started in 1969 so i've been pretty much you know i forgot what i was at the time whatever that is you know like wait two years old then yeah no like 18 or something or 20 or whatever 22 i don't know yeah i got that and so that's probably what helped you get through the the loss the financial loss in 1984 and kind of the the the public i guess embarrassment or humiliation that you might have faced since it was public and processing through your emotions through i lost a son on my greatest loss um not quite two years ago 42 year old son oh my god i would rather die i would rather lose everything and i had and okay but it's you know it was it was that um and it's like the serenity prayer you know uh surrendered god gave me the acceptance the ability to accept that which i can't control and the power to control that which i can and the wisdom to tell the difference and um so they're yes because life happens to you okay and you can't just sit there and be sorry for yourself i mean i don't mean when hurt happens that you that you can't nurture yourself and and take care of yourself but then comes a period of reflecting and you have to deal with it so meditation and that equanimity is just so important i just lost my father three months ago and unexpectedly and it was uh it's been a it's been a grieving process and uh lots of beautiful grateful moments but also a lot of sadness and almost every few days you know a lot of sadness that comes over me over different moments i i um i i know well then here's here's my here's my the way i the way i see it um don't feel sorry for yourself feeling sad um go into it yeah uh in other words when i think of my son and youth you think about your father and there's the missing um um go into that that's okay because he he in his way is with you in a sense you're keeping that memory so it's bittersweet yes and what happens is that the um with time the sweetness increases relative to the bitterness and also um learn the lesson um to to love and cherish all the other people in your life go hug them go spend the time with them go appreciate you know smell the flowers that remain you know um because there's there are other joys around you and that you know and then realize that your sadness is because something that must have been terrific was taken away from so you've had all that terrificness and i mean it better that way than not having it that way so anyway those are the things help me i uh i can go at length of other things that i did that helped me uh i'll might as well say that because maybe they help your viewers too what's been the biggest yeah i mean i think that's probably the again i don't have any kids so i don't know what that would feel like but i've i've heard that that's one of gotta be one of the greatest losses for a parent to lose a child what's been the biggest lesson for you and throughout the last couple years well and i want to generalize it to you losing your father i remember when i lost my mother for the first time and in the early time i couldn't imagine laughing again and now i mean like okay i laugh and i almost have mental conversations with her because i know what she would answer and so on so i think it applies to all important losses and some of the things that uh helped me well besides meditation was to do it very naturally feel what i felt whatever i felt i would go with it another thing i did was i would journal my wife and i have a cup of tea each morning and we have a picture of him there and um and we have some flowers and then we journal memories of him that's beautiful and um though we jump and that brings those memories out i've been i journal and i pass it to her and she journals um and that keeps those memories alive and then we'll give that to his daughter um and then there was a book a little book i forgot the name of the book that somebody sent us on grieving or mourning and it had a series of things we would read a page in that every day um and it would you know it was like a lot of good advice um death happens to everybody i mean everybody is gonna you know people i love everybody everybody's going to die um and to pay attention to it and know how to do it well we don't talk much about it and we should really so anyway those are some of the things that helped me i appreciate that that's a that's beautiful and to go along with that i guess how do you view death for yourself as as you continue to evolve and grow and obviously getting older do you think about your own mortality do you think about your own death do you think about of course what you want to do with your time do you think about what you want to do with your your lessons or your wealth or what is what are those thoughts of course of course it's um um first of all i accept the arc of life you know the arc of life and death um so it's very real and then um i and i'm blessed with like i could do almost anything i want to do um and i'm at a stage in my life where something seems natural to me which is a transition from my second stage of my life to my third so i said the first is when you're uh learning and depending on others second stage of life is others are depending on you you're working to be successful third stage of life is when you're free of all obligations so you're free to live and free to die you're going to expose you're going to have that and you have your blessings my grandchildren and anything and i can do whatever i want to do and i find that instinctually during that transition period from my second phase to my third phase is to pass along things that i had to help others be successful without me um so yes that happens to do with uh wealth it happens to do most importantly i think with principles that have helped me why am i doing this this this call okay because i think it'll be helpful and that that period of time will last last a very short period of time i think that probably there's one more book i want to put out which is the econom my economic and investment principles i passed that along i think i'll be gone and then i'll go quiet and and uh and i'll just you know save her life and and those things but i find life very exciting and stimulating but i i'm approaching it with no obligation like i've passed along with control of the business that i built and i love it because i want to help them be successful without me so that's that's where i am that's beautiful um a couple final questions for you i feel like i could speak with you for for many hours ray so i appreciate your time but i want to be respectful as well um one question about your thoughts on decentralizing you know money with the dollar and the euro and all these things losing its value and with the what seems like hysteria of crypto nft the metaverse you know money in the metaverse type of conversation i kind of include all that what do you see happening there in the future with crypto i think i read somewhere that you own some of crypto i'm not sure how much but you're a little bit done some of it just a little bit what what's your thoughts about the crypto space bitcoin ethereum kind of all of that in the future i think we're in an era of that money as we know it which is a fiat money is being devalued um and um and it's and it's going to change and yeah the dollar's role is going to change and that alternatives were are going to compete with that so like i wouldn't want to own money when you own a dollar let's say is in the form of a debt instrument so you're going to get paid back in that and i think it'll have a negative real rate of negative buying power and so on in almost any currency and they're all competing so they'll all they're all devaluing essentially and so money is about the medium of exchange and a storehold of wealth that is portable and works in most countries um and now we'll find out what what those things are i mean gold is an example of one of those um and uh crypto is an example of those and um you know maybe nfts are and who and who knows i think we're in a kind of a who knows kind of phase new things come along and then they'll be that and i think they'll compete and i think that um people will start to think about how do i have a portfolio of those things that i can take from that are widely accepted that i can trans um and that maintain buying power now there's challenges to that like when you have a lot of volatility in it it means that oh my god my owning it is more volatile right you know it's more risky than my not owning it um and so that drives money into sort of other things but anyway we're going to struggle with that and you're going to see digital currencies in different countries and so on and i honestly don't know i don't think one thing wins out um i do think that um a lot of um the crypto um you know they go like all markets they go through phases and here's kind of the bubble phase where you know it goes up a lot and everybody believes it and the story believes it and everybody's bought in it and then you have the adjustments and and so on i think there's too much emphasis in it because the total value you know of bitcoin or even the cryptocurrency is not much is comparable to the value of microsoft so um one has to think when one thinks of assets i would rather think about the whole array of assets than to think about um you know just who is it going to be that crypto bitcoin won yes i think people could be too concentrated on that and i think that could be uh dangerous right so i don't know the answer i do know there are lots of storeholds in wealth that you can uh diversification is your key yeah diversification is my key yeah there's a great quote um that i like and i'm gonna butcher it but it goes something like this i think it's from jim carrey where he says i i wish everyone uh had the ability to become rich and famous and realize that that's not the answer something something something around that i'm paraphrasing it that's so true if you could give people uh the what it feels like to be you know one of the richest people in the world and what a lot of money means what does it actually mean if you could kind of share that with people i ca i can just i could describe it what it means for me um and might be different things for other people uh let me start off by i and i acquired it by an accident because the game that i happen to fall in love with if you learn to play the game well it pays well right okay and a lot of people i think that's true with a lot of people who are coming up with ideas and building businesses and so on they got excited about it that does it works well and um and then it pays well um uh to me um it's a serious mistake that thinking that success is measured in such things um because money has no intrinsic value okay what does money get you and what do you need now um i uh what i want um is well what i want is freedom and the ability to be creative and and and do that that's that you know that's what i want uh but and and money helps me get that it helps me help other people it helps me have the impact um i i like those things about it but more importantly i like my game i like to play with my game um not more important but anyway comparably important i think that success is having the life that you want to have as long as you're earning more money than you spent and that can be um uh spending very little and having a wonderfully luxurious life like i watch a lot of people um don't have much money and of different ages sometimes young sometimes older they travel around the world they backpack they go to different cultures and different places um they can live in a tent or in the most beautiful not you can the most beautiful nature is available to you or you can be in a hostel or you can meet in so many different countries surfing and have free and freedom and so on i think everybody should almost experience that to know that they can have their their a great deal of freedom without a great deal of money and that also um so and and that status thing is a silly thing okay that's like being hung up on living your life for approvals and so um and so don't get on the track and lose sight that okay what is it that you really want in your life what is a successful life for you it's not measured by um how much money you have or how much status you have or almost that other stuff it's it's measured and you know like i would say again meaningful work and meaningful relationships if you have something as your work that you're into and your craft and it's a thing you love and you have meaningful relationships i think those are the most important things to make a rich life and the more i i learned the more i realized i was lied to like we're taught to go to school to get a degree to get a job so we can then get a job and climb the corporate ladder but wealthy people don't do that wealthy people are not working to climb the corporate ladder they're working to own the corporate ladder how did anyone realize that you could do that

Channel: Lewis Howes

Views: 314,361

Keywords: Lewis Howes, Lewis Howes interview, school of greatness, self help, self improvement, self development, personal development, success habits, success, wealth, motivation, inspiration, inspirational video, motivational video, success principles, millionaire success habits, how to become successful, success motivation

Id: Sg7XCQwoUiA

Length: 157min 33sec (9453 seconds)

Published: Wed Sep 14 2022