Navigating Big Debt Crises
Last week, I reviewed Ray Dalio's new book "Principles for Navigating Big Debt Crises" for the Wall Street Journal. I've included the first paragraphs and a link to the full piece below.
Charting the Markets
The founder of Bridgewater Associates takes stock of major financial events from the past century. He keeps his own counsel.
Ray Dalio’s “Principles for Navigating Big Debt Crises” is the work of a self-taught economist and self-made billionaire. The first 70 pages of the book, in which the founder of Bridgewater Associates introduces his theory of debt cycles, have no citations. He apparently stands on the shoulders of nobody.
Mr. Dalio’s education came on trading floors, not in classrooms. “There is nothing,” he writes, “like the pain of being wrong or the pleasure of being right as a global macro investor to provide the practical lessons about economics that are unavailable in textbooks.” The challenge for such an autodidact, then, is how to transcend the limits of personal experience when personal experience is the most reliable source of insight. “Big Debt Crises” is his response to that challenge: a compilation of historical case studies presented as a trader would have experienced them in real time.