There were certainly several reasons why the market may have rallied hard on Thursday, most summarized already in various TSP posts. But it was definitely not hurtful that Ray Dalio, Founder, President and Chief Investment Officer of Bridgewater Associates, gave a very rare and generally bullish interview to CNBC this morning.
Bridgewater is known as the world's largest hedge fund with an estimated $87 billion in assets under management and a reported 40+% return in 2010. Mr. Dalio has been called "an enigmatic character whose economic insights are pored over by central bankers across the globe." Mr. Dalio's infrequent public appearance came about chiefly as a result of some recent negative press concerning the culture at Bridgewater, summarized in part below:
"The latest issue of AR Magazine (Absolute Return + Alpha) profiles Ray Dalio's mega-successful Bridgewater Associates, with much space devoted to the "culture" of the firm, as defined by Principles, a handbook of sorts written by Dalio. In sum, the firm requires its employees, 30 percent of whom leave within two years of being hired, to "trust in truth" and to "pursue the truth" relentlessly, in everything they do. Criticism is "both welcomed and encouraged" and rather than "depersonalizing mistakes" or saying "we didn't handle this well," the staff are told to "connect specific mistakes to specific people." It's an environment unlike any other hedge fund and those who've experienced the program firsthand seem to be divided into two camps, at least among those interviewed by AR. Dalio and the Bridgewater officials (senior staff are referred to as "culture carriers") who think it's great and former employees who describe the place as "cultlike," "sinister," "eerie" and something out of George Orwell's 1984."
I have more than a little personal knowledge about Bridgewater, which is one of the largest employers in my hometown and know several people who work there. Yes, the turnover rate is extremely high and the atmosphere is pressure-packed. Every single meeting is videotaped, from job interviews to the most mundane daily staff meetings, both as a permanent record and as 'training opportunities" (with the possible exception of a very few senior level proprietary discussions). I have read their "Principles" thoroughly and they are quite daunting in their length, absolute certitude, and overwhelming call for complete and total "transparency" and personal responsibility. Not that that is necessarily bad and in fact many of the "Principles" are quite inspiring. But the intimidating culture might be summed up best by one of Mr. Dalio's quotes, "Conflict in the pursuit of excellence is a terrific thing and is strongly encouraged at Bridgewater, in fact demanded."
In any event, I have not personally met Mr. Dalio and was somewhat pleasantly surprised by his appearance on CNBC.
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