06/10/2023
Ray Dalio said recently:
As you probably know, I believe that there are five major interrelated forces that are now driving most everything in ways that have never happened before in our lifetimes but have happened many times in history. They are:
Very high levels of debt and debt creation in the US and other reserve currency countries;
Intense levels of conflict within countries (most importantly the US) due to large wealth and values gaps and populist extremists of the right and the left fighting to win at all costs;
Intense levels of conflict between countries (most importantly between the US and China and those aligning with them) in a classic great power conflict;
Significant damaging acts of nature (droughts, floods, and pandemics) and;
Mankind’s learning and deploying new technologies (most recently and notably, AI).
In my book "Principles for Dealing with the Changing World Order," I show many cases of these things happening and created a classic template against which I compare actual developments with. In my periodic communications, I look at actual developments and compare them with the template that lays out a picture of what is most likely to happen.
This week, I shared two perspectives on the latest episodes in this unfolding drama. The first (“The Thinking Behind Why Cash Is Now Good (and Not Trash)”) was about the debt/debt creation force. My latest (“Why the Failure of Kevin McCarthy Is Another Step Away from Democracy and Toward Civil War”) is about the internal conflict force and you can read more about it here:
As you probably know, I believe that there are five major interrelated forces that are now driving most everything in ways that have never happened before in our lifetimes but have happened many times in history. They are: 1) very high levels of debt and debt creation in the US and other reserve cur