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

Where you go in life will depend on how you see things and who and what you feel connected to (your family, your community, your country, mankind, the whole ecosystem, everything). You will have to decide to what extent you will put the interests of others above your own, and which others you will choose to do so for. That's because you will regularly encounter situations that will force you to make such choices. While such decisions might seem too erudite for your taste, you will make them either consciously or subliminally, and they will be very important. For me personally, I now find it thrilling to embrace reality, to look down on myself through nature's perspective, and to be an infinitesimally small part of the whole. My instinctual and intellectual goal is simply to evolve and contribute to evolution in some tiny way while I'm here and while I am what I am. At the same time, the things I love most--my work and my relationships--are what motivate me. So, I find how reality and nature work, including how I and everything will decompose and recompose, beautiful--though emotionally I find the separation from those I care about difficult to appreciate. #principleoftheday

If incomes fail to grow as quickly as debt and debt service, the ratio of debts to incomes will mechanically grow, which will require increased borrowing to service debt as well as to spend. The cycle goes from low to high to unsustainably high debt and debt service relative to incomes. 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, here: #howcountriesgobroke #principles

Reconciling different points of view can be difficult and time-consuming. It is up to the meeting leader to balance conflicting perspectives, push through impasses, and decide how to spend time wisely. A common question I get is: What happens when someone inexperienced offers an opinion? If you're running the conversation, you should be weighing the potential cost in the time that it takes to explore their opinion versus the potential gain in being able to assess their thinking and gain a better understanding of what they're like. Exploring the views of people who are still building their track record can give you valuable insights into how they might handle various responsibilities. Time permitting, you should work through their reasoning with them so they can understand how they might be wrong. It's also your obligation to open-mindedly consider whether they're right. #principleoftheday

If we want to resolve our current income, wealth, and productivity gap, we need to get back to the basics. We need good education, so our children are productive and can work well together. We need a civil society with rule of law, and good capital markets that produce good income. And we need to double down on the fundamentals — earning more than we spend, and having more assets than liabilities. Do all of that, and we’ll be in great shape.

When an empire runs out of its own money, it is able to increase the supply of money. However, printing more money causes borrowing to increase creating a financial bubble. I urge you to watch “The Changing World Order” on my YouTube channel to understand how, and what it means for all of us. #principles #raydalio

It is often best to repeat a specific question to be sure both questioner and responder are crystal clear on what is being asked and answered. In an email, this is often as simple as cutting and pasting the questions into the body of the text. #principleoftheday