How the Economy Works, According to Ray Dalio
Prepare for 2022.
Ray Dalio is the founder of Bridgewater, one of the biggest hedge funds in the world.
He’s published several books to explain the principles he has used to build his company and his life.
Find below a simple yet clear explanation of how the economy works.
This will help you understand what 2022 has reserved for your finances.
What’s the Economy?
The economy is the total sum of all the transactions made.
A transaction is made when one exchanges a good or a service against money.
Transactions are made by different agents: people, businesses, banks, and the government.
The government is the biggest spender.
It is composed of two parts: the central bank, which controls the amount of money in the economy and the interest rate of the debt, and the central government, which collects taxes and spends them.
