Genre
PhilosophyInvestingLearning
Last Read
December 4, 2018
“Radical truth and radical transparency are fundamental to having a real idea meritocracy”.
Review
This is a popular book which most of you may have read. Dalio believes in being rooted in principles to systematize decision-making and minimize errors. It’s great to see Dalio’s self-reflective nature and how he takes full accountability for his shortcomings throughout the book. Dalio believes that the best way to succeed is if you: i) seek out the smartest people who disagree with you so you can try to understand their reasoning, ii) know when not to have an opinion, iii) develop, test and systematize timeless and universal principles and iv) balance risks to reduce the downside whilst maximising upside.
Dalio advocates for writing down and recording rationale behind the key decisions you make, so you can check the reasoning later.
Life Principles
1. Embrace Reality and Deal With It 2. Use the 5-Step Process to Get What You Want Out of Life 3. Be Radically Open-Minded 4. Understand that People are Wired Very Differently 5. Learn How to Make Decisions Effectively Work Principles
1. Trust in Radical Truth and Radical Transparency 2. Create a Culture in Which It Is Okay to Make Mistakes and Unacceptable Not to Learn From Them 4. Believability Weight Your Decision Making 5. Recognize How to Get Beyond Disagreement 6. Hire Right, Because the Penalties for Hiring Wrong are Huge 7. Constantly Train, Test, Evaluate, and Sort People 8. Manage as Someone Operating a Machine to Achieve a Goal 9. Perceive and Don’t Tolerate Problems 10. Diagnose Problems to Get at Their Root Causes 11. Design Improvements to Your Machine to Get Around Your Problems 12. Recognize the Power of Knowing How to Deal with Not Knowing 13. Remember the 80/20 rule, and know what the key 20% is 
