It’s a famous quote: “Those who cannot remember the past are condemned to repeat it.” It has only been twelve years since the Great Recession and we are currently in the midst of another. How are these economic patterns created? What can be done to better prepare and sustain ourselves when we find ourselves in a crisis?
This is where author Ray Dalio comes in, providing insight on roughly 50 financial crises throughout the 20th century in his book Big Debt Crises. He explains how they’re cyclical, how they’re started, and why they’re likely to happen in the future. This is the essential playbook for understanding the economic landscape we live in and how it will change or stay the same.
If you’re seeking an insider’s view on how to deal with financial crises and have an interest in economics, then this is a worthwhile addition to your library. As a bonus recommendation, another worthwhile read on the subject is The Pandemic Information Gap: The Brutal Economics of COVID-19 by Joshua Gans, which is available in eBook form.
Here is the summary of Big Debt Crises on Amazon:
“On the 10th anniversary of the 2008 financial crisis, one of the world's most successful investors, Ray Dalio, shares his unique template for how debt crises work and principles for dealing with them well. This template allowed his firm, Bridgewater Associates, to anticipate events and navigate them well while others struggled badly.
“As he explained in his #1 New York Times Bestseller, Principles: Life & Work, Dalio believes that most everything happens over and over again through time, so that by studying their patterns, one can understand the cause-effect relationships behind them and develop principles for dealing with them well. In this 3-part research series, he does that for big debt crises and shares his template in hopes of reducing the chances of big debt crises happening and helping them be better managed in the future.
“The template comes in three parts provided in three books:
1) The Archetypal Big Debt Cycle (which explains the template)
2) 3 Detailed Cases (which examines in depth the 2008 financial crisis, the 1930's Great Depression, and the 1920's inflationary depression of Germany's Weimar Republic), and
3) Compendium of 48 Cases (which is a compendium of charts and brief descriptions of the worst debt crises of the last 100 years).
“Whether you're an investor, a policy maker, or are simply interested in the unconventional perspective of one of the few people who navigated the crises successfully, Principles for Navigating Big Debt Crises will help you understand the economy and markets in revealing new ways.”
