Why It’s A Good Idea To Define Your Principles
It’s no secret that people RESPOND well to people who know what they want. The RULES OF ENGAGEMENT with people who know what they want are clear, simply because grey left the room when black and white were the only options allowed on the table. Basically, there’s NO ROOM FOR WAFFLE with those who know what they want.
Behind each person who knows what they want are a set of principles. These are fundamental truths that serve as the foundations for behavior that get you what you want out of life. In a book titled "The Little Prince” which is universally cherished by children and adults alike, the author Saint-Exupéry’s most famous line, “What is essential is invisible to the eye” perhaps, best underscores how we need to see and value principles. Before we can rush off to read articles, autobiographies or watch documentaries about individuals who have gone on to do great things through their life’s work, it’s important that we consider developing and have in place principles of our own when stepping out into the world. Taking the time to question, stress-test and finally settling on principles that give you a map in moments of decision-making or uncertainty.
No stranger to principles is billionaire investor and founder of Bridgewater Associates, Ray Dalio, who admits that, “Whatever success I’ve had in life hasn’t been because of anything unique about me—it’s because of principles that I believe anyone can adopt.” As a testament to his unrelenting devotion to the principles he lives by, the man even owns the domain principles.com where he has made it his life’s work to share his principles. “In order to be great, one can’t compromise the uncompromisable.”, says Dalio who published a book that combines a memoir with Dalio’s celebrated principles for success in life and business, simply titled “Principles: Life & Work.”
It is these fundamental truths that gave him a map of for navigating the business world at age 26 when he founded Bridgewater Associates back in 1975 in his two-bedroom Manhattan apartment. Three decades later, during the 2008 financial crisis that tanked most investment funds and saw many reporting losses, Bridgewater’s Pure Alpha fund posted gains of 9,5 percent. By 2010, Bridgewater’s Pure Alpha fund rose by 45 percent, or $15 billion, more than the combined profits of Google, Amazon, Yahoo and eBay combined.
He has made it his life’s work to share these principles and tools on his website and it goes without saying, that his principles are worth taking some notes from and considering what might make sense for you.
Here are some of Dalio’s favorite principles which we can all find useful in our daily lives:
Seek out the smartest people who disagree with you so you can try to understand their reasoning.
Rather than thinking, ‘I’m right.’ ask yourself, ‘How do I know I’m right?’” and then systematizing the answers into timeless and universal principles.
There are always risks out there that can hurt you badly, even in the seemingly safest bets, so it’s always best to assume you’re missing something.
Know when not to have an opinion.