The Fund: Ray Dalio, Bridgewater Associates, and the Unraveling of a Wall Street Legend - Rob Copeland

[Saluki]

There was an article discussed on here recently about the strange cult like atmosphere and practices at Dalio's fund.  If you want to take a deeper dive down the rabbithole, this is the book for you. Dalio's "Principles", which are ever changing and sometimes contradictory are the tenets of the faith, and there are strange show trials that are reminiscent of the communist era that occur constantly and are recorded and circulated as teaching examples in the search for what they call the truth.  One manager told new recruits that the fund is truth machine that just happens to invest money, but that they could cure cancer if they wanted to . 

 

Somehow Ray ("Rainman" behind his back) takes part as judge and jury in many of these lengthy trials to get the "truth" of why someone let him down. Most are eventually fired or quit. There was the six week trial, orchestrated by Dalio, of the people in the facilities department so that he could get to the bottom of who ordered white boards that don't completely erase, but smear a little when you erase.  Most offices solve this problem with a $3 bottle of something you squirt on the board, but this took a full blown trial by Dalio himself to get to the bottom of it. There was another trial about the size of the parking passes (the person responsible was fired, but they decided to keep the new parking passes anyway).  And there was also the case of the person who didn't get it all in the urinal.  Dalio had people monitoring the men's room and janitorial staff would go in and see if the person had peed on the floor and report back.  They had the urinals looked at to see if there was something about the design that made them defective and did other things to reduce the chance of urine ending up on the floor. All this was overseen by Dalio himself. 

 

He hired former FBI director James Comey, who had five kids to put through college and was trying to justify his existence so he began bugging the offices and reading people's emails to try to get something on someone to fire them so he could look like he was doing his job.  His high/low point was when he left a binder out with someone's name on it out in the open and recorded a low-level new hire opening it. He was fired. Imagine being an FBI bigshot and you have to set up traps like this or get to the bottom of who pees clumsily at the urinal.  

 

People are paid way over market, but they don't last long because you are expected to keep filing reports on your co-workers who fail to live up one of the Principles at any time.  It's easier to kiss up and kick down, so the churn is constant. When Dalio realized that they weren't getting as many offers accepted, and many people were quitting, he blamed himself. Just kidding, he had a trial for the person in charge of hiring because she was obviously hiring the wrong people and her process was wrong. 

 

Yes, he did predict the 1987 crash.  But he's made the same prediction numerous times before and after so he's predicted 15 of the last 1 crashes. He's kind of obsessed with Buffett and Steve Jobs and he tried to get Walter Isaacson to write his bio. Isaacson declined. 

 

A weird, strange look behind the looking glass.  Highly recommend. 

[Xerxes]

Have neither read the book nor the article below. But might as well post it. 
 

[Gregmal]

I’ve always felt bad for people who are so consumed with their image and how they are perceived by others. Such a shallow way to live. Ray seems like the king of the category. 

[Charlie]

"I’ve always felt bad for people who are so consumed with their image and how they are perceived by others. Such a shallow way to live. Ray seems like the king of the category."

 

 

 

One of the best Charlie Munger quotes I´ve ever read is about the stock picking industry: 

 

"If you stop to think about it, civilized man has always had soothsayers and shamans and

faith healers and God knows what all. The stock picking industry is four or five percent

super rational disciplined people. The rest of them are sort of like faith healers or shamans.

That´s the way it is, I´m afraid. It´s nice that they keep an image of being constructive,

sensible people when they´re really would-be faith healers. It keeps the self-respect up."

 

[schin]

I'm not necessarily a big fan of Ray Dalio -- but, his holdings are not amazing, but should not be prone to big blow-ups.  It should track the indexes with so much diversification... 740 stocks.. I mean... that's the S&P 500 and a half.....  closet indexer.

 

https://hedgefollow.com/funds/Bridgewater+Associates

 

Does anyone know how his major investors are?

 

[Xerxes]

On 12/5/2023 at 1:18 AM, schin said:

I'm not necessarily a big fan of Ray Dalio -- but, his holdings are not amazing, but should not be prone to big blow-ups.  It should track the indexes with so much diversification... 740 stocks.. I mean... that's the S&P 500 and a half.....  closet indexer.

 

https://hedgefollow.com/funds/Bridgewater+Associates

 

Does anyone know how his major investors are?

 

but that is not 740 names across one single fund. They have many funds. But yes point taken. Too many names. 
 

just from memory, Ray’ organization is/was famous because of their “all season fund”*. So not so much the specific equity names being overweight, but rather asset allocation between equities and bonds. That was their special sauce. The macro allocation geared for these uncertain times ! That special sauce failed miserably in 2022 when the bubble in the bond market popped. 

 

* when was the last time anyone heard as Breaking News on business channels that Ray is buying significant stake in xxxx company

[schin]

On 12/6/2023 at 4:31 PM, Xerxes said:

but that is not 740 names across one single fund. They have many funds. But yes point taken. Too many names. 
 

just from memory, Ray’ organization is/was famous because of their “all season fund”*. So not so much the specific equity names being overweight, but rather asset allocation between equities and bonds. That was their special sauce. The macro allocation geared for these uncertain times ! That special sauce failed miserably in 2022 when the bubble in the bond market popped. 

 

* when was the last time anyone heard as Breaking News on business channels that Ray is buying significant stake in xxxx company

@Xerxes -  Ray is definitely not an activist investor/hedge fund. But, looking at his holdings, most have earnings and generally good ROIC. So, just removing the crummy and marginally profitable business from the index should keep him alive for ages....   I love the "radical" transparency concept -- but, it's sad to hear he's a tyrant in disguise.

[schin]

Never thought Ray Dalio will be part of a rap song...

 

 

"With principles thick as Ray Dalio"

 

3:15-16 mark.
 

[Baoxiaodao]

Well, there are always two sides to the coin but I guarantee you a hilarious read as I chuckled so many times while listening.