The Froogal Stoodent: Life and Work Principles: A Froogal Stoodent review

Life and Work Principles by Ray Dalio

A Froogal Stoodent Review

If you're interested, you can find this book at Amazon.

Fourth in a series of book reviews by The Froogal Stoodent

As usual, I’m a little backward—I actually read Dalio’s The Changing World Order first (it was available online in 2020, during the pandemic, and was almost done when I stumbled across it).

I found The Changing World Order to be filled with insight, so I figured I’d read Dalio’s first work when I got a chance. Sure enough, I got the opportunity, so I took it.

If you don’t know who Ray Dalio is, he’s the founder of Bridgewater Associates, one of the most successful hedge funds of the last 50 years. He’s well-known for his viral video “How the Economic Machine Works.”

The main target audience of this book seems to be entrepreneurs, founders, and high-level managers. And the target audience will almost certainly find it useful.

Dalio begins with a brief autobiography, titled “Where I’m Coming From.” In this, he writes a bit about his own life and experiences, and how those experiences helped to shape his thinking. The second section contains his principles on successfully managing life, though it’s pretty much set in a context of work. The third section contains his ideas about management, and would be very useful for a lot of leaders and even for small-business owners.

I thought the book was pretty well-done, and a fairly easy read considering the dense subject matter. It’s definitely not a read-in-one-sitting kind of book; expect it to take at least a few days to work through.

The one part that irritated me came when Dalio spent several pages holding forth on how miraculous evolution is, by giving constant feedback that continuously makes things better.

This is a common fallacy that laypeople make when it comes to evolution. Dalio may be right about ‘evolution’ working this way in business [though I suspect he is actually wrong about that too], but his take on the evolution of species—or the process of evolution in general—is fallacious.

Here’s a good resource on the basics of evolution. Essentially, evolution doesn’t necessarily lead to ‘improvement,’ whatever that means. The process of evolution occurs gradually, as a result of the pressures that every living being faces—finding food, avoiding predators, and successfully reproducing.

So, even if the process of evolution were to somehow yield an ‘optimal’ set of traits for a given species, some feature of the environment will inevitably change—and the ‘optimal’ species will no longer be optimal for the newly-changed situation.

Think of the dinosaurs, which, after millions of years, were pretty well-equipped to handle the hot, humid, swampy supercontinent that existed 100 million years ago. But suddenly—BAM!—a huge meteor plows into the earth. Within hours, the global environment changed irrevocably, affecting even species that were hundreds of miles away from the impact site.

And, as a result of that catastrophe, mammals now enjoy the dominant status on the planet.

Hence why I was so annoyed by Dalio’s misunderstanding. Evolution doesn’t create a set of ever-improved species, nor does it create a set of ever-improved businesses.

The natural environment is constantly changing in some way—food becomes scarcer; predators become more numerous; a volcano spews ash and lava all over a 100-square-mile area…

Similarly, the business environment is always changing in some way—a recession hits and consumers [in aggregate] have less disposable income; a different political party comes to power and changes some key laws and policies; a new startup comes in and turns the traditional business model on its head…

Clearly, there is no universal set of optimal traits for all situations. Whether we’re talking about businesses or biological organisms, there is no such thing as an ‘upward spiral.’ There is only change. Some changes are gradual and predictable; these may even appear to result in the spiral of improvement that Dalio discusses. Other changes, however, are sudden and cause massive upheaval.

Either way, nature is constantly at war with itself. And I don’t think a perpetual state of war is something to aspire to.

Aside from the infuriating, almost religious, reverence for a misunderstood version of evolution, I thought this book contained a lot of valuable wisdom.

Dalio’s main model is to seek frequent feedback, and to constantly try to poke holes in one’s assumptions.

This approach is akin to the scientific method, and such an adversarial approach tends to give one the quickest path to truth. When managing people’s money, it is certainly crucial to find the truth quickly!

Another benefit of this approach is that it forces one to be humble, because this system constantly reminds you that you might be wrong—which, paradoxically, will usually make you frequently correct.

I’m a big fan of this model, whether it comes to doing science or business.

For Pete’s sake, just don’t compare it to evolution.

Notes and Quotes:

“Don’t mistake the trappings of success for success itself.” (p. 173)
“Knowing how to deal well with your setbacks is as important as knowing how to move forward.” (p. 173)
“View painful problems as potential improvements that are screaming at you.” (p. 174)
“Focus on the ‘what is’ before deciding ‘what to do about it.’” (p. 174)
- People seldom follow this rule, because it tends to run counter to common human weaknesses. Namely, impatience and the desire to fix a problem right now, the very moment it is identified.
- I can’t tell you how many times I’ve witnessed this in person. People just want the issue to go away. So they sweep that dirt right under the rug, where no one can see it anymore. So if people [like your boss] can’t see the problem, it no longer exists…right?
“Too many people make the mistake of spending virtually no time on designing because they are preoccupied with execution. Remember: Designing precedes doing!” (p.177)
Section 3.3, “Appreciate the art of thoughtful disagreement” (p. 190-192), is too valuable to try to summarize with a single quote. Definitely worth reading; I’d be willing to bet that nearly anyone could benefit from reading the whole section!
Same goes for Section 3.4, “Triangulate your view with believable people who are willing to disagree” (p. 193-195).
- When Dalio says “believable” throughout this book, I mentally substituted “credible,” which is a more precise word to describe his meaning. His explanation of the term is that a “believable” person is one who has demonstrated the skill in question on multiple occasions, and can clearly articulate why he or she made those decisions. Hence why I think the word “credible” applies better than “believable.”
“Largely because they are the easiest to measure, memory and processing speed tend to be the abilities that determine success in school…school performance is also a good guge of a person’s determination to succeed, as well as their willingness and ability to follow directions.” (p. 413)
“Smart people are the ones who ask the most thoughtful questions, as opposed to thinking they have all the answers. Great questions are a much better indicator of future success than great answers.” (p. 415)