Education

Ray Dalio helps put recent economic & market moves in perspective

Ray Dalio is the founder one of the world’s largest hedge funds, Bridgewater Associates. He is one of the 100 wealthiest people in the world.

If you are unfamiliar with how Dalio understands the economy and markets (ie. his mental model of how these work) this article he shared over Christmas is a good read.

To whet your appetite:

At the biggest picture level, there are three big forces that interact to drive market and economic conditions over time.  They are 

1) productivity growth, 

2) the short-term debt cycle (which typically takes about 5-10 years), and 

3) the long-term debt cycle (which typically takes about 50-75 years).  

These factors also affect geopolitics both within and between countries, which also affects the market and economic conditions.

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