 Hey, this is a review of Big Debt Crisis by Ray Dalio. Primarily this is about the cycles of finance and in the subtitle it says navigating. So you want to navigate through these Big Debt Crisis that keep on happening. Obviously there's something going on. Ray Dalio is a bridge fund associate. It's a very large and successful firm and he also wrote the Principles book which is a bestseller. And you can see the division just like Sal Olinsky, the haves and the have-nots. We have the investors, the workers and the risk takers with money versus the have-nots. The people that are lacking or the people that don't have money or assets. The book is a bit technical. There are great study of charts and it goes through all the debt crisis that have been happening. The bubbles and the burst, the bulls versus the bears. There's a ton of valuable information in the book to understand credit and improve your credit. Not so much to improve your credit card score but to not go overboard and over leveraged. And surprisingly, I bought this book for a dollar. Money is a story and any currency could be made up to any value. Here's a small list of what is in the book, deflation, debt restructuring and austerity and how it relates to foreign capital flows. How short-term debt cycles can add to long-term debt cycles and how there are patterns of these crises. There's excessive loans. There's gold standard that America got rid of. There's hoarding cash and gold. Social unrest that can happen. Some rather on the right or left happens during these times. There's leveraging and deleveraging and how banks can abandon the mark to market accounting. And what you want to do is see this coming and be prepared and there's protectionism and anti-immigration during these hard times. How prices go up, inflation and how during these times they want to punish the bakers and when you really don't want to do that because that is the time when credit and lending is most important. There's a fear of selling for a loss of an asset whether it be house or financial stocks. Depending on the debt crisis is you can spot bubbles or the herd or the lemming had to cut back your losses and hedge the risk and understand how shadow banking is a huge part of the world. And some of the events that it covers is Germany inflation after World War I, the Great Depression around 1929, Japanese inflation during the lost decade of starting around 1990, the tech bubble of 2000, the Great Recession in 2008, which was a financial crisis and banking crisis as well as real estate and the current bubble of being in 2020. And during these times you can see the effects of what happens when money is not available. That's why you see many of these central banks cutting interest rates and flooding the economy with cheap credit and free money, which is inflation. And here are some bubble characteristics. Prices are high relative. Prices are discounting future rapid price appreciation. There's a broad bullish sentiment. Purchases are financed by high leverage. Buyers have made extended forward purchases to protect future prices. New buyers enter the market. And when you stimulate policy, it threatens, which in turn, tightens the monetary, which in turn, tightens the money supply. And sometimes you'll see risky debtors, mispayments, lenders worry, credit spreads tick up, lending slows, unemployment rises and inflation rates rise as well. There's a lack of cash flow. And sometimes you'll see economies use quantitative easing and lower interest rates and taking that step by step until it's fixed or during the next crisis. Do it again. So in the book, it does go through all these events of all these crises and a few of them talk about one of them is Germany. And after World War One, they of course lost the war. And typically the winners get the spoils. And what happened with Germany is their economy is ruined, scarred in their jobs and everything was lost. So what happened was their economy really never got going. And they had to end up paying reparations for the war. So what happened in Germany is they kept on inflating their currency more and more to pay off debt. And what happened was the citizens of Germany saw no confidence in their economy. So what they did is they did carry trade or just get assets from anywhere but Germany because the inflation rate of their currency was getting out of control. So they buy gold or assets or just try to store money in any other country but their own. So after being threatened by this, all these reparations from all these other countries such as UK and America, hyperinflation pretty much destroyed Germany. They even had right wing people try to get them going and eventually got assassinated. So this Germany was one of the best to understand hyperinflation. And eventually what happened was Hitler got into power during that and went through like their little revolution. It had so much debt, all these other countries were threatened and evaded so they had no choice but to print and devalue their currency. So during the Great Depression, especially in America, there was so much debt during this time and it was the war in 20s that stocks were financed by borrowing margin, that there was so much speculation on the stocks that eventually it crashed. And it kept on crashing, did all these wild swings and it just got worse and worse. They did try to save the banks, add more money and try to use debt to build industry. But it just wasn't enough. There were so many days, Black Thursday down 10%, Black Monday 13%. It was just crazy that they had the quintessential you call the bear market rallies. It's like a head fake. But there just was not enough money out there and there was just so much debt, corruption that it really didn't fix itself for about 10 years. There was bank runs, just a total loss of confidence and it really sparked many movements to have reliability in banks. And the unemployment during 1933 was 25%. And it helped the banks have that FDIC insurance on deposits. So people would have confidence. The government would give you confidence that the bank would not fail. Now, during Japan, during the 1990s, they called the loss decade. They had so much debt and their population just wasn't growing as well. That there was euphoria. They had all these zombie companies. They just kind of almost build out everything where there was no growth. They called it like the era of stagnation. And that lasted for 10 years or so. The property was super expensive out in Tokyo. And nowadays you see that even Japanese people aren't even having kids. There's no growth. Now, for the 2008, around there are American crisis during the financial crisis, the Great Recession. The banks were out of control. They had all these derivatives and the real estate just crashed. There's so much debt, so much wild parties. And they ended up cutting interest rates to grow the economy, which has caused us more asset bubbles. And then here we are in 2020 with this new crisis. So how does this book affect me? I did work for a bank during that financial recession, during the Great Recession. So I've many interesting stories during this time. And some of the tricks that I've learned over the years, such as the carry trade. Now, this is just a currency swap. And what it is, is you find that other people, what they do, is they invest in another currency by borrowing through a lower interest rate. So I do it in a different way. So my $100 will go much farther in a different country, such as a third world country. And this is really geo-arbitrage, but I still would call it a carry trade. You could pay less taxes, but in the end you profit or you can get better deals. Another thing to do is to learn how to short sell. And what that is, is you borrow a stock and buy it later, hoping to profit on the game of the stock's loss. So in other words, you're betting against companies. So in other words, you can bet against REITs. Those are real estate investment trusts, airlines, casinos, banks. Right before the crisis, you kind of sense it. And most people don't understand that or do it, but you can buy ETFs to know how to do it. During this time in September, 2020, it's one of the wildest bear markets ever, that we are inflating the hell out of the currency. And we'll see what's gonna happen because there's nothing that you could do to stop the animal spirits of what it really wants to do, what it wants to be or whether it be a bear or a bull. And understand the shadow banking system. What goes on with banking outside of the banking system? That would be more like the black market, the gray market, or any type of lending off the books. So whatever numbers you hear, unemployment numbers, poll numbers, what is it really? And understand others around you, such as the herd or blue pill people, the euphoria, the panicked mania. You could short sell the arrogance, especially when they're over leveraged. This book will help you navigate the crisis just by recognizing some crises. Save money, live humbly. Restaurants and expensive vacations are luxuries. Make cuts and thrive, you can have fun. Money is a story, whether it be gold, Bitcoin, assets, it might be a good idea to get them as long as you have freedom and not let those things own you. Have a hedge. Now I'm gonna go through some of the influences I've had through the banking industry, as well as some of the books I've read or as well as I think are the best to try to check out to help you guys out. So I'm not gonna mention YouTubers, I'll do that for another video, but I'll recognize probably the most important one that I like the most is Jim Rogers. He worked in the banking industry, has like a Southern gentleman vibe. He knows a lot about currency, commodities, and he buys assets when most people hate him. He recognizes China and their growth. He's kind of like my history teacher. He's global, real markets, understand the black market and shadow markets. Recognize bureaucrats, that's his signature line, as well as what influences me the most. Let the system clear in the real world. He travels a lot, has all these books about travel, been all over the world, understands nature and failure. A natural economist, don't have too much debt. Some people are very questionable about him because he worked for the George Sawers Fund, but I don't judge him on that. He's more into basic stuff, farming, and he's worried about the future. And with these travels, you can recognize the real versus the propaganda. I've read a few of his books and buy beat up stocks as a style. And admits he's not very good at timing the market. So this is a disqualifier. Another guy recommended is Robert Kiyosaki. Now, he's probably more popularized on YouTube and other people know about him. You can understand bureaucrats, the Fed versus the academics, how the feds have PhDs. Click links on the down below. I will have a link about his, one of his work. And he's more of a real estate guy, but I had to put him up here just cause he's a little different. Ames Raw, he has his opinion. And my second favorite is Mohamed El Ariyan. You'll see him a lot on CNBC and other channels, but he's probably the most honest, fair guy in the finance industry. He's a bond guy, and he's most of the time he's wrong, but you can see his senses that he's right in terms of economics. And he's one of the people that actually care about the average person. And then there's this guy I just found out about. His name's Hugh Hendry. He's a hedge fund manager from England. And he's originally from Scotland. He's a currency guy, hedge fund guy. He's a 60s dude living out in the Caribbean. He's artistic, somewhat red pill, rides a boosted board. So he's around 60 and rides a boosted board. I just found out about this guy. He's got a YouTube channel, just check out the link. Now, some of the short sellers you should know, as I mentioned before in the earlier video, is to bet against and as to do as a hedge. There's Bill Ackman, Jim Chanos, who has a fund called like Cinec. And these guys are very smart. So don't always be bullish on certain stocks such as Tesla or Grubhub. Try to see things for what it is, and they can pick it and understand fraud. Typically, bring down the fraud. He helped bring down Enron, which helps people out. People don't like the short seller, but they do aid humanity. And there's Nourio Rabini, you get some authentic little dark side Dr. Doom, but this guy's raw and I really like his work. Now, in terms of shorts on, you gotta understand Nasib. And you'll see that I will review all his books, at least most of them. Understand the blocks, swan event, fat tail risks, and probably one of the most well-read people that I like to learn from. Intellectual, ultra cocky, so I like his work. Unless you are a hedge, that is my statement. That's a line from the scene. And another guy is Carl Icahn, just understand how you can short people short real estate, and that's something I always end up doing. And the first person I probably learned from, not so much Jim Rogers, was Jim Kramer. He's got the personality, he's really good for beginners. He does make mistakes, but at least he's trying to help out people. And of course, Warren Buffett. He's very good for good business. Now, when he means good business, I not mean best for the environment, but he wants a business with good management and not too corrupt. Some of the lines he has is, you'll hear it investing yourself, how the tide comes in and when it comes out, it'll reveal everything, the fear and greed. I don't want to mention everything, you do your own research, the Buffett indicator, the market cap to US GDP or GNP. And he has a style where investors come to him, which is great for business, because you want to sell a guy like Buffett out there, where he's not really tracing the profit. He's buying hold of value guy. He's the Oracle Omaha. And there's that great line, bulls make money, bears make money, pigs get slaughtered. I'm not sure who said that, but it's a very good line and very authentic. And in terms of a YouTuber, I'll make another video about that, but the only guy I'll mention really is Matthew Crater. He has his YouTube channel called Trader University. He has courses, books, and he's got a good channel. And he's got the most raw channel out there, I would say. Not the most exciting, but he's very knowledgeable and work with Peter Thiel. He worked with the hedge fund. He's helping out the average middle guy, so I really recommend his channel. I have many more. Just check out my California bear flag playlist. That'll be mostly about finance and money videos. All right, thanks for listening.