Gustavo Ballvé on March 12th, 2012
Food for thought, Home, Investment Themes, Mental models, Portfolio Management, Risk management

We’ve posted here before about Ray Dalio – about his management, life and investing principles. We were reminded of him and his frameworks because of a story in Economist.com about how Mr. Dalio sees the US in a process of “beautiful deleveraging” (by the way, here’s a Feb. 2012 paper he wrote on deleveraging). We’re also posting (inside) an October 2011 video interview and a link to a post at ValueWalk.com with a reading list he recommends (as longtime readers know, we’re big on reading lists). Finally, here’s a short interview with another money manager, Ken Griffin, on (mostly) politics. The best use of these stories is to extract ideas/ frameworks and to see how different people apply different principles and methods in different walks of life, without making their ideas your own.

You don’t have to be a “fan” because Ray Dalio and Bridgewater have been so successful (or Ken Griffin & Citadel, Warren Buffett, etc.), and you don’t have to agree with all, most, or even any of either man’s principles and frameworks: it’s up to you to decide, after you’ve thought hard about them, after you’ve sought out conflicting opinions, after you’ve created your own hypotheses and tests. But make sure you think about it. Over my career I’ve caught myself once or twice thinking that my framework/ idea “toolkit” was pretty much “set”. Terrible idea.

More importantly: you don’t have to marry anyone’s ideas, but consider them no matter the source, and use the ones that make sense to you while leaving room for adjustments and corrections as you and your ideas evolve.

Here’s the video interview (23min):

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