Ray Dalio Misses the Point: Wealth is created by risk-takers, not a compliant society

The Looted Wealth of China

I enjoy all books.  I like books much better than people in general, even though people write books.  I figure that if someone works hard enough to write a book, they have thought their thoughts through enough to have some respectful consideration.  But I don’t like small talk and just yacking with people over nothing.  If a conversation is not the most epic philosophical consideration in the history of mankind, then I don’t have a lot of use for it.  So instead of wasting time with lots of people talking about nothing, I spend my time reading books, even by people I disagree with, such as Ray Dalio.  He has a new book out, which I pay attention to because I have enjoyed his other works. I’m afraid I have to disagree with Ray Dalio on much, especially this latest offering.  Ray has a lot of problems, he’s a globalist, and he has bet against America with his many billions of dollars, and things aren’t going to work out for him like he thought they were.  I think you’ll find me disassembling this globalist view of the world more and more because, in this global war for which we are all a part, I see the tides changing in favor of an America First agenda.  I just received my membership card to the America First Policy Institute on the same day that I received my monthly magazine for the NRA, and it was a good day for me.  I see great catastrophe for Ray Dalio and his fellow globalist billionaires from where I view the world.  That doesn’t mean I hate Ray.  I actually like him, but just because he has billions of dollars, that doesn’t mean he’s beyond reproach.  His new book was essentially a remake of the grand globalist book I refer to a lot, Tragedy & Hope, which was a globalist point of view of the history of the world. Ray’s book is the same; only he’s trying to sell computer model simulations on human behavior to justify his massive investment into China, which has now pretty much announced itself as an enemy of America.  And people like Ray have been handed the detonator for world destruction, and he’s trying to convince us all why he must push the button.

Ray and the gang, let’s call them the “Davos Crowd,” essentially believed that the global economy would shift into China.  They know the globalist’s game; corporations have a quarterly mandate to always show increases to their shareholders and to everyone’s point of view, America was a saturated market.  There are only 300 million people in America, and they can all only buy so many cars, tennis shoes, and hamburgers.  So the globalists want new markets to exploit that ever-present need for upward trends of profit forecasts, and places like Africa, India, and China look like that next untapped well.  While doing media for his new book, Ray himself has said that China has over 1 billion people increasing in median income year by year.  That is where the expanding middle class is, not in America, so that has been the focus of investors like Ray. America’s middle class is dying because many of the jobs that made it up have been transferred to places like China and the minds of people like Bill Gates, Ray Dalio, and Michael Bloomberg, the billionaire class, that is an investment into a bigger house.  The middle class in America can only grow so much.  But there are many more opportunities for wealth generation in China among a larger country with a much larger population, 3-1.  So that is why the markets of the world turned toward China for the next great gold rush of expanding markets.  Only, there is a problem.  China is a communist country, and these billionaires have been caught tampering with global politics by using Karl Marx’s philosophies to move market value from one place to another, leaving behind the criminal underclass to control all their wealth as the curtain everyone sees.  And now they’ve all been caught, and the sentiment is flipping back to America.  What China did with the coronavirus in partnership with Dr. Fauci and the NIH was reprehensible.  It was much worse than when Japan bombed Pearl Harbor, and now China is a villain to the world, and all the investments that people like Ray have made there are in jeopardy. 

You have to understand wealth creation, which I explain extensively in my own book, The Gunfighter’s Guide to Business.  The middle class is not a finite creation.  Wealth just doesn’t happen, as Ray often alludes to in his books when he talks about the cycles of civilization.  Wealth is made from risk, and when a nation produces lots of risk-takers, then it can be said to be wealthy.  When a nation produces many compliant people, as China does because of their communist government, you will have perpetual stagnation.  There is currently an expanding middle class in China because that wealth drives it to be stolen from American capitalism.  It’s just money that was moved to a bigger balloon, but the wealth generated is finite; it’s limited to the air in the balloon.  What makes the air is risk; what expands wealth is not compliance and order, the way all corporations would love it to be, but in reckless investment for the gain of capital off innovation and diligence.  Inventors don’t stay up all night writing code or inventing a new concept so they can turn it over to the state for redistribution.  They want to get rich, just as people will sit at a poker table and gamble on a pot of money, hoping to win it.  The game generates wealth because it inspires risk to win it.  Elementary economic stuff, but it’s what’s missing in Ray’s books, his graphs on human nature and the history of the world, and all those like him in the billionaire class who obviously feel guilty about their own wealth and aren’t sure they deserve so much power over others because of it.

China’s rise to power is over; their trajectory to be the new example of markets is deflating as we speak.  Oh, sure, many governments still think China is the future, but they don’t understand the basics of wealth creation even though they may be personally wealthy themselves.  America is a culture of risk, and that is why it has been and will continue to be wealthy. America’s wealth is not present because of policy, politics, philosophy.  A centralized authority can’t control it.  It’s not something that is managed by the global Davos crowd. They’d love to control it, to loot off it, to ride it for their ease and comfort.  But stealing America’s wealth and giving it to China as they have been doing from behind the face of governments won’t make China wealthy and expand their middle class in the same way it did in America.  Because to create wealth, you must have risk and ambition unleashed in a free market and society.  And China isn’t and will never be free.  The number of people happy with a car, a house, a spouse, a few kids, and an iPhone that can track you in everything you do is not enough for many people.  And for the people it is enough are not the types who make extraordinary wealth.  So when Ray puts up his computer models about human behavior to justify billions of dollars in investments he has made into China, he is always missing the most critical thing in a society that wishes to be wealthy, that there are plenty of risk-takers who are willing to stay up all night and work through the weekends to invent a new market.  And it is with them, and only them, that an expanding middle class is born, and there are people to buy hamburgers, go to amusement parks, and buy tennis shoes.  Centralized authority always kills wealth, and in this case, Ray and his friends will lose many billions in their gamble against America for the great nothing of China’s rise to power.


Rich Hoffman

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