Earlier, I mentioned that the unique abilities of thinking logically, abstractly, and from a higher level are carried out in structures located in the neocortex. These parts of the brain are more developed in humans and allow us to reflect on ourselves and direct our own evolution. Because we are capable of conscious, memory-based learning, we can evolve further and faster than any other species, changing not just across generations but within our own lifetimes. This constant drive toward learning and improvement makes getting better innately enjoyable and getting better fast exhilarating. Though most people think that they are striving to get the things (toys, bigger houses, money, status, etc.) that will make them happy, for most people those things don't supply anywhere near the longterm satisfaction that getting better at something does. Once we get the things we are striving for, we rarely remain satisfied with them. The things are just the bait. Chasing after them forces us to evolve, and it is the evolution and not the rewards themselves that matters to us and to those around us. This means that for most people success is struggling and evolving as effectively as possible, i.e., learning rapidly about oneself and one's environment, and then changing to improve. #principleoftheday

While we can measure the level of risk, that cannot tell us exactly when the debt problem will occur because different conditions and different people’s reactions to them lead to different lead times for the selling of debt assets and other actions that precipitate a crisis. For a picture of where we are headed and what we should do, you can order my new book, How Countries Go Broke: The Big Cycle, at the link in my bio. #howcountriesgobroke #principles

THESE are the most important things for 20 year olds to consider.#raydalio #principles #advice #motivation #lifeadvice

THESE are the most important things for 20 year olds to consider. #raydalio #principles #advice #motivation #lifeadvice

When central governments do their jobs well, they tax and spend in ways that provide broad-based productivity and prosperity, sometimes borrowing more than they are earning and sometimes paying it back, and when central banks do their jobs well, they keep the credit, debt, and capital markets in relative balance, which produces less disruptive big swings. However, for the previously mentioned reasons, the bias to create more ups in economies and markets through credit stimulation leads to long-term uptrends in debt and debt service relative to incomes until they become too large a percentage of income to be sustainable. For a picture of where we are headed and what we should do, you can order my new book, How Countries Go Broke: The Big Cycle, at the link in my bio. #howcountriesgobroke #principles

If you follow the news, it’s probably clear to you that the current monetary order, domestic political order, and international geopolitical order are all on the brink of breaking down. We are headed for great conflicts and disruptive changes. That’s because the world order is now changing in a way that I described in my book and video Principles for Dealing with the Changing World Order. Put simply, there is a pattern of cause-effect relationships that drive the rise and decline of empires. Changes like these occur in a Big Cycle that we can understand by examining how they have occurred across countries throughout history. And you don’t have to take my word for it — the underlying metrics are measurable and show us how a typical cycle transpires. I hope you’ll read the book — or watch the full animated video at the link in the comments — and learn about it so that you understand what we’re dealing with, and what you can do to navigate the interesting times ahead.

My view is that buying and holding real estate is not an effective investment strategy in our current economic environment, for a few reasons. 1) Real estate is more interest rate sensitive than it is inflation sensitive, so given our current circumstances it is likely to go down in real terms 2) It is a fixed asset that is easy to tax, which limits its impacts on your ability to diversify 3) Real estate is nailed down, so investing in it makes it more difficult to move money from one place to another That’s my view, in a nutshell. I’m curious to hear if you agree. #GovernmentDebt #debt #principles

Too often groups will make a decision to do something without assigning personal responsibilities, so it is not clear who is supposed to follow up by doing what. Be clear in assigning personal responsibilities. #principleoftheday

Natural selection’s trial-and-error process allows improvement without anyone understanding or guiding it. The same can apply to how we learn. There are at least three kinds of learning that foster evolution: memory-based learning (storing the information that comes in through one’s conscious mind so that we can recall it later); subconscious learning (the knowledge we take away from our experiences that never enters our conscious minds, though it affects our decision making); and “learning” that occurs without thinking at all, such as the changes in DNA that encode a species’ adaptations. I used to think that memory-based, conscious learning was the most powerful, but I’ve since come to understand that it produces less rapid progress than experimentation and adaptation. To give you an example of how nature improves without thinking, just look at the struggle that mankind (with all its thinking) has experienced in trying to outsmart viruses (which don’t even have brains). Viruses are like brilliant chess opponents. By evolving quickly (combining different genetic material across different strains), they keep the smartest minds in the global health community busy thinking up countermoves to hold them off. Understanding that is especially helpful in an era when computers can run large numbers of simulations replicating the evolutionary process to help us see what works and what doesn’t. #principleoftheday

Topic slip is random drifting from topic to topic without achieving completion on any of them. One way to avoid it is by tracking the conversation on a whiteboard so that everyone can see where you are. #principleoftheday