Why now is a good time to read 'Principles for Dealing with the Changing World Order'

Every week The Money Show interviews the author or reviewer of a new or trending business book.

This week Stephen Grootes talked to regular reviewer Ian Mann, MD of Gateways Business Consultants.

Mann reviewed Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail.

It's written by legendary investor Ray Dalio, author of the New York Times bestseller Principles, who has spent half a century studying global economies and markets.

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Principles for Dealing with the Changing World Order (2021) examines history’s most turbulent economic and political periods to reveal why the times ahead will likely be radically different from those we’ve experienced in our lifetimes - and to offer practical advice on how to navigate them well.

"The point is that these are enduring principles. Dalio's been running a hedge fund which is probably the biggest on the planet, and because of that it's always been terribly important that he understand global movements."

"Trying to understand this better and better, he came to the conclusion from his work that there are cycles - He has a massive team and he got them to do a whole lot of research, then passed it on to experts and then he'd come back to his team for revision, send this back to the experts and so on. And remember he's using the best of the best on the planet that is available to you when you are a billionaire and you have R136 billion under management."

"Dalio came to the conclusion that there are cycles, by looking at the rise and fall of empires over hundreds of years, focusing on those from about 500 years old."

"Once he's gone through the big cycles he says, let's have a look at what supports those cycles - and he gets into really granular info which supports the notion that he has which goes something like: the ones most important to us are the Dutch the British and the Americans. All of those have been the world's reserve currencies, and America will remain the world's reserve currency for a good 20 years after they've stopped being the world's greatest and wealthiest country, much the same way as with language - if we're used to speaking in English we're unlikely to change to another language."

"The big cycles are driven by the success and failure of major countries through the ages and he proves that, driving these cycles is that countries rise and then they get to a stage where - because they're human - they start imploding internally."

"If you look at the rise of a power, they grow strong when they develop productive economies, they have strong education, they have good systems, innovation and military power. Once they've been doing this for a while they get to their peak, and this peak goes down - you dominate world trade and finance and geopolitics, and your currency becomes the world currency but what happens internally is that you extend yourself too far and success breeds complacency."

"The complacency allows you to have debts that rise, your production slows because there is wealth and you don't have to work that hard anymore. And when you have countries that become rich and flabby they tend not to work as hard and then you have countries taking over from them later that are prepared to work much harder."

Description on Amazon:

A few years ago, Ray Dalio noticed a confluence of political and economic conditions he hadn't encountered before.

They included huge debts and zero or near-zero interest rates that led to massive printing of money in the world's three major reserve currencies; big political and social conflicts within countries, especially the US, due to the largest wealth, political, and values disparities in more than 100 years; and the rising of a world power (China) to challenge the existing world power (US) and the existing world order.

The last time that this confluence occurred was between 1930 and 1945. This realization sent Dalio on a search for the repeating patterns and cause/effect relationships underlying all major changes in wealth and power over the last 500 years.

In this remarkable and timely addition to his Principles series, Dalio brings readers along for his study of the major empires--including the Dutch, the British, and the American--putting into perspective the "Big Cycle" that has driven the successes and failures of all the world's major countries throughout history. He reveals the timeless and universal forces behind these shifts and uses them to look into the future, offering practical principles for positioning oneself for what's ahead.

Scroll back up to the audio player to listen to Mann's review