BARTIROMO EARLIER THAT OTHER
SPORTS LEAGUES SHOULD FOLLOW THE
WTA EXAMPLE.
BILLIONAIRE CHINA INVESTOR RAY
DALIO CAME UNDER FIRE FOR
CONTROVERSIAL COMMENTS HE MADE
EARLIER THIS WEEK SAYING WE HAVE
OUR OWN HUMAN RIGHTS ISSUES HERE
IN THE U.S., AND THAT THE CCP IS
BEHAVING LIKE A QUOTE, STRICT
PARENT.
DALIO WAS ASKED ABOUT THAT
EARLIER.
>> THERE WAS A BACKLASH THIS
PAST WEEK TO SOME COMMENTS YOU
MADE, OFF NEW FUND IN CHINA --
YOU HAVE A NEW FUND IN CHINA,
YOU WERE ASKED ABOUT HUMAN
RIGHTS THERE, INCLUDING THE
DISAPPEARANCE FROM PUBLIC LIFE
THE TENNIS PLAYER.
SOME OF THE COMMENTS STRUCK SOME
LISTENERS AS JARRING.
YOU SAID YOU THOUGHT CHINA WAS
BEHAVING LIKE A STRICT PARENT.
SOME PEOPLE THOUGHT YOU WERE
EQUATING HUMAN RIGHTS CONCERNS
IN CHINA WITH THOSE IN THE U.S.
SO I WANT TO GIVE YOU AN
OPPORTUNITY NOW.
TELL ME WHAT YOU MEANT BY THOSE
COMMENTS.
WHAT’S THE ROLE OF A MONEY
MANAGER PUTTING WORK TO CHINA IN
ASSESSING HUMAN RIGHTS?
WHAT’S YOUR ASSESSMENT?
>> THANK YOU FOR LETTING ME
CLARIFY THIS.
A LOT OF MISUNDERSTANDING.
I GET THROWN A QUESTION, AND I’M
TRYING TO ANSWER THE QUESTION IN
A STRAIGHTFORWARD WAY.
AND JUST LET ME BE CLEAR THAT I
REALLY THINK I AT THAT
SPONTANEOUS MOMENT DID NOT MAKE
CLEAR.
FIRST OF ALL, THIS ISSUE, THIS
HUMAN RIGHTS ISSUE IS OBVIOUSLY
A BIG ISSUE, AND I WAS NOT
MEANING TO SUGGEST THAT THEY ARE
OPERATING IN A WAY THAT IS THE
SAME AS WE ARE OPERATING IN
DEALING WITH THOSE THINGS.
I WAS NOT MEANING TO EQUATE
THOSE THINGS.
ON THE QUESTION OF BEING ASKED
ABOUT, QUOTE, THE STRICT PARENT,
THAT WAS NOT MY INTENTION.
I WASN’T MAKING THAT STATEMENT.
I WAS INTENDING TO CONVEY A
STATEMENT THAT WAS MADE TO ME BY
A POLICYMAKER.
AND IN ORDER TO TRY TO PASS
ALONG UNDERSTANDING.
I WASN’T COMMENTING ON WHAT I
THOUGHT ABOUT THE STRICT PARENT.
I WAS COMMENTING ON WHAT’S
AUTOCRATIC AND WHAT’S
DEMOCRATIC, TWO DIFFERENT
APPROACHES.
AND ON THIS ISSUE, I THINK I
DON’T WANT TO MINIMIZE THAT
ISSUE.
THAT IS AN IMPORTANT ISSUE.
AND I WANT TO ALSO DESCRIBE THAT
AS AN AMERICAN, WHO KNOWS THE
DIFFERENCES BETWEEN THESE TWO
COUNTRIES, I HAVE SPENT ALL OF
MY LIFE HERE AND ALSO ABOUT HALF
OF MY LIFE GOING TO CHINA, AND I
FIND MYSELF IN THE MIDDLE OF
THOSE TWO THINGS, AND I’M DEEPLY
CONCERNED ABOUT WAR, ABOUT THE
CONFLICT BETWEEN THESE TWO
IDEOLOGIES OR THESE TWO TYPES OF
APPROACHES BECAUSE I THINK THAT
THERE IS A RISK OF THAT.
AND BEING IN THAT POSITION, I
WANT TO TRY TO HELP THAT
UNDERSTANDING, AND I DID A LOUSY
JOB OF CONVEYING THAT.
THIS IS A SITUATION WHICH IS
FACED BY SOMETHING LIKE 40,000
INVESTORS AND HUNDREDS OF
THOUSANDS OF BANKS, BUSINESSES,
AND SO ON, THAT ARE AMERICAN
BUSINESSES THAT ARE OPERATING
THERE.
THEY FACE THE SAME QUESTION THAT
WE’RE DEALING WITH.
AND THAT’S A DIFFICULT QUESTION,
OF HOW TO APPROACH THAT.
AND WHEN WE’RE TRYING TO BALANCE
THOSE THINGS, WE ALSO REALIZE
THAT IF THERE’S DISENGAGEMENT,
WHAT THAT WOULD BE LIKE FOR THE
SOCIETY AND SO ON.
>> TELL ME ABOUT RISK AND
RETURNS.
YOU HAVE BEEN INVESTING IN CHINA
FOR SO LONG.
HOW HAVE THE RISKS CHANGED?
ARE THE RISK ADDED TO BY THE
KINDS OF THINGS WE’RE TALKING
ABOUT NOW?
HOW DO THE OPPORTUNITIES FOR
RETURNS THAT YOU SEE THERE, HOW
DO THEY COMPARE WITH WHAT YOU
HAVE SEEN IN DECADES PAST?
>> WELL, IN DECADES PAST, WE
DIDN’T HAVE THE MARKET CHOICES
THAT WE HAVE NOW.
I MEAN, SINCE I STARTED GOING
THERE, PER CAPITA INCOME’S
INCREASED BY 26 TIMES.
THE ECONOMY HAS GONE GREAT, AND
THEN YOU SEE THE INVESTMENTS OF
THE BUSINESSES, DIFFERENT
BUSINESSES.
THEY HAVE DEVELOPED CAPITAL
MARKETS, THE SECOND LARGEST
CAPITAL MARKETS IN THE WORLD, SO
NOW THE OPPORTUNITIES TO BE ABLE
TO INVEST ARE JUST REALLY
LARGELY OPENING UP, AND YEAH,
AND I THINK THAT THEY ARE
ATTRACTIVE FOR REASONS WE CAN
GET INTO, BUT I ALSO THINK
DIVERSIFICATION IS IMPORTANT IN
THIS KIND OF AN ENVIRONMENT.
SO WHEN I THINK OF THE U.S.
MARKETS OR I THINK OF ANY
MARKETS, I’M IN 40 COUNTRIES,
SOMETHING LIKE 40 COUNTRIES,
WHEN I THINK ABOUT THAT, I HAVE
TO THINK ABOUT DIVERSIFICATION,
PARTICULARLY GIVEN THE
COMPETITION THAT’S GOING ON.
>> I WAS GOING TO ASK YOU IF YOU
FEEL YOU CAN TRUST THE
GOVERNMENT THERE PUTTING SO MUCH
MONEY TO WORK BUT, YOU KNOW,
MAYBE YOU’RE SAYING WITH THAT
LEVEL OF DIVERSIFICATION, IT IS
ABOUT YOU KNOW STAYING SAFE BY
SPREADING THE MONEY AROUND.
>> WELL, OKAY, LET ME GET TO
WHAT I’M TRYING TO GET TO IS THE
ISSUES THAT WE’RE REALLY DEALING
WITH IN TERMS OF THE ISSUES OF
WAR AND THE CONFLICTS; RIGHT?
SO I THINK THAT LIKE A LOT OF
COUNTRIES, THERE ARE A LOT OF
RISKS THAT ARE EXISTING IN CHINA
AND EXIST IN THE UNITED STATES.
AND THAT COMBINATION OF THOSE
RISKS ARE SOMETHING THAT I’M
TRYING TO COMMUNICATE CLEARLY
HERE IN ORDER TO UNDERSTAND WHAT
THAT DIVERSIFYICATION LOOKS LIKE
>> TELL ME WHAT’S BEHIND THE
BOOK.
THE BOOK IS CALLED "PRINCIPLES
FOR DEALING WITH THE CHANGE IN
WORLD ORDER, WHY NATIONS SUCCEED
AND FAIL".
WHAT WERE YOUR THOUGHTS BEHIND
WRITING THIS BOOK?
>> THERE WERE THREE BIG THINGS
THAT HAPPENING IN MY LIFETIME,
HAPPENING NOW THAT NEVER
HAPPENED IN MY LIFETIME, IN OUR
LIFETIMES BEFORE THAT HAPPENED
MANY TIMES IN HISTORY.
THOSE THREE THINGS ARE
FINANCIAL, IN OTHER WORDS,
SPENDING A LOT MORE MONEY THAN
WE ARE EARNING AND CREATING A
LOT OF DEBT, WHICH IS THEN BEING
MONETIZED, AND IT WORKS ITS WAY
THROUGH THE SYSTEM TO PRODUCE
THE TYPES OF RESULTS THAT WE’RE
HAVING.
IT CAUSES GOOD SERVICES,
FINANCIAL ASSETS, PRICES, ALL TO
GO UP, PRODUCES A TYPE OF
INFLATION
INFLATION, IN THAT EVENT.
THE SECOND IS THE INTERNAL
CONFLICT, THE COMBINATION OF
WEALTH GAPS, POLITICAL GAPS, THE
LEFT AND THE RIGHT IS HAVING A
CONFLICT, A LEVEL OF CONFLICT
THAT IS THE HIGHEST SINCE 1900.
AND THE THIRD IS THE RISE OF BIG
GREAT POWER TO CHALLENGE THE
EXISTING POWER, THE EXISTING
WORLD ORDER, AND THAT CONFLICT.
THOSE THREE THINGS HAVE NOT
HAPPENED SINCE THE 1930 TO 45
PERIOD, AND I’VE LEARNED IN
HISTORY, THAT I NEED TO
UNDERSTAND THAT PATTERN.
BY STUDYING, FOR EXAMPLE, THE
GREAT DEPRESSION, I WAS ABLE TO
ANTICIPATE -- WE WERE ABLE TO
ANTICIPATE THE 2008 FINANCIAL
CRISIS.
>> YOU WRITE ABOUT WHAT YOU SEE
IS A 30% CHANCE OF CIVIL WAR IN
THE U.S. OVER THE NEXT DECADE,
WHICH IS ALARMING.
WHAT DO YOU MEAN BY CIVIL WAR?
WHAT WOULD CAUSE THAT?
WHAT SHOULD WE DO TO PREPARE FOR
THAT?
NOT JUST AS INVESTORS, I
SUPPOSE, BUT AS CITIZENS?
>> WELL, WHEN THE CAUSES THAT
PEOPLE ARE BEHIND ARE MORE
IMPORTANT THAN THE SYSTEM, THE
SYSTEM’S IN JEOPARDY.
THAT’S SHOWN REPEATEDLY IN
HISTORY.
AND SO IF WE REALLY TAKE THE
ELECTIONS, AND WE TAKE THE
SPLITS THAT ARE TAKING PLACE
NOW, THERE’S A QUESTION, AND A
LIKELIHOOD THAT WE WILL GO TO
HIGHER AND HIGHER LEVELS OF
POLARITY IN WHICH NEITHER SIDE
IS GOING TO GIVE UP LOSING, THAT
THEY WILL OPERATE IN A CERTAIN
WAY THAT WOULD BE AT RISK.
I THINK WE’RE SEEING THAT SHIFT
IN VALUES, THE SHIFT, THE
CONFLICT IN VALUES CAUSING
MOVEMENTS TO DIFFERENT STATES,
NOT JUST TAXATION, AND THOSE --
THERE’S A TENDENCY, HISTORY
SHOWS, FOR THOSE WHO ARE
SIMILAR, THE RICH GOING DOWN TO
SOME PLACE, THE POOR GOING --
[INAUDIBLE], THE HOLLOWING OF
LOCATION, FINANCIALLY AS THE TAX
BASE GOES, INTENSIFYING THOSE
CONFLICTS.
SO I THINK THAT THAT TYPE OF A
CONFLICT IS AT RISK.
I DO THINK THAT --
>> YOU MEAN A METAPHOR CIVIL
WAR, OR YOU MEAN AN ACTUAL ARMED
CONFLICT?
>> NO, I DON’T THINK THAT WE’RE
GOING TO HAVE AN ARMED CONFLICT,
BUT I DO THINK YOU’RE GOING TO
HAVE A POWER DECISION MAKING,
NOT DECISION MAKING WHEN THERE’S
GOING TO BE FOLLOWING THE LEGAL
SYSTEM EXACTLY.
FOR EXAMPLE, WHEN THE FEDERAL
GOVERNMENT IS GOING TO MANDATE
SOMETHING WHERE THE STATE AND
LOCAL GOVERNMENTS ARE GOING TO
HAVE TO DO THINGS, I THINK THERE
WILL BE AN ARGUMENT AS TO WHO
HAS WHAT POWER.
AND WHEN THEY HAVE THAT KIND OF
ARGUMENT, THAT STARTS TO BEGIN
TO PRODUCE A TYPE OF INTERNAL
CONFLICT THAT MAKES THE PLACE
DYSFUNCTIONAL.
WHAT WE HAVE TO DO ABOVE ALL
ELSE, THREE THINGS THAT NEED TO
BE SUCCESSFUL.
FIRST, YOU HAVE TO EARN MORE
MONEY THAN YOU SPEND, AND YOU
HAVE TO BE PRODUCTIVE.
SECOND, YOU HAVE TO BE ABLE TO
WORK WELL TOGETHER, IN A
BIPARTISAN WAY, IN A MIDDLE KIND
OF WAY THAT’S GOOD FOR THE WHOLE
COUNTRY.
IF YOU DON’T MAKE IT GOOD FOR
THE WHOLE COUNTRY, IT WON’T
WORK.
AND THE THIRD IS THAT YOU HAVE
TO DEAL WITH THE EXTERNAL