Ray Dalio

And then the central bank now owns all these treasuries.

And then the central bank starts losing money because they own the treasuries.

And they're going up.

So they have to produce the money and credit to keep that going.

rate down, and they lose more and more money.

And that dynamic then doesn't stop the change in the capital flows.

And then traditionally, in all of these cases, you see a move to the hard money, the move to gold.

okay, as we're seeing, you see that dynamic in terms of that move to gold, and then it starts to run its course.

So it's very much like, think about what happened from 71 through the 70s, produces more stagflation, and then at some point, the inflation problem or the devaluation of money problem becomes such that the central bank then tightens money and

Right.

And so on.

The Volcker years.

The Volcker years, 1979, 80, 81, 82, right?

So the pendulum swings.

Think about it this way.

In order to have a balance, a successful economy, a successful capital market, since one man's debts are another man's assets, you have to keep interest rates not so high that they crush the debtor

without having them so low that they are bad for the creditor.

So you see these cycles.

When we had zero interest rates and negative real interest rates, what you saw was massive creation of credit and money and borrowing and so on.

And then you had that cycle.