WEBVTT - Nir Bar Dea 0:00:02.950 --> 0:00:04.870 Most of the largest hedge funds in the world are 0:00:04.890 --> 0:00:08.369 run by people with extensive backgrounds in finance. However, one 0:00:08.390 --> 0:00:11.170 of the largest hedge funds in the world, Bridgewater, is 0:00:11.230 --> 0:00:13.310 now run by somebody who spent six years in the 0:00:13.330 --> 0:00:16.390 military before he even graduated from college and then went 0:00:16.430 --> 0:00:18.739 on to business school. I had a chance recently to 0:00:18.750 --> 0:00:21.700 sit down with the CEO near Bardea and ask him 0:00:21.920 --> 0:00:24.779 how his background in the military is helping him transform 0:00:24.820 --> 0:00:27.260 Bridgewater into one of the great hedge funds in the world. 0:00:27.960 --> 0:00:30.460 I've always seen Bridgewater as a firm that focused a 0:00:30.500 --> 0:00:34.120 lot on macro trends. And Ray used to talk about 0:00:34.500 --> 0:00:38.300 global inflation or high interest rates and so forth. Do 0:00:38.340 --> 0:00:40.240 you spend a lot of your time thinking about what 0:00:40.280 --> 0:00:42.440 the Federal Reserve is going to do or what's going 0:00:42.460 --> 0:00:43.640 to happen on the war in Iran? 0:00:43.880 --> 0:00:47.330 I and we spend all of our time trying to 0:00:47.340 --> 0:00:47.930 unpack that. 0:00:49.350 --> 0:00:52.410 It's everything that matters about the value that we're supposed 0:00:52.430 --> 0:00:54.430 to bring to the world and to our clients. And 0:00:54.450 --> 0:00:56.070 I absolutely don't do what you're saying. 0:00:56.790 --> 0:00:58.050 Brazil is built as a meritocracy. 0:00:59.790 --> 0:01:01.410 If it's in the textbooks, if I have the answer, 0:01:01.430 --> 0:01:02.590 I don't need it. 0:01:02.570 --> 0:01:03.730 1,200 employees. 0:01:03.850 --> 0:01:06.550 The whole point is bringing smart people and have them 0:01:06.590 --> 0:01:07.929 explore the stuff that's not. 0:01:07.850 --> 0:01:08.430 In the textbooks. 0:01:08.870 --> 0:01:12.000 We need the ideas wherever they come from to bubble up, 0:01:12.620 --> 0:01:16.580 to debate, to argue where needed, and to create the 0:01:16.620 --> 0:01:19.000 chemistry that takes the best of my ideas and the 0:01:19.040 --> 0:01:22.020 best of somebody else's ideas and writes a new textbook. 0:01:22.319 --> 0:01:24.560 Let's talk about Washington for a moment. Do you spend 0:01:24.660 --> 0:01:26.650 much time figuring out what the Fed is likely to 0:01:26.690 --> 0:01:28.729 do or trying to figure out what it has done? 0:01:29.160 --> 0:01:31.809 We have an entire team focused on understanding not just 0:01:31.830 --> 0:01:34.530 the Fed, the backdrop of what is happening with supply 0:01:34.550 --> 0:01:37.390 and demand and capital, how that translates to fiscal and 0:01:37.420 --> 0:01:40.360 monetary policy, and then also extrapolating what is likely to 0:01:40.380 --> 0:01:41.260 happen in the U.S. 0:01:41.280 --> 0:01:41.760 And around the world. 0:01:42.250 --> 0:01:44.090 What about what Congress is going to do? You try 0:01:44.110 --> 0:01:45.630 to figure out what they're going to do or not? 0:01:45.810 --> 0:01:49.030 Understanding the political situation and what it means about the 0:01:49.070 --> 0:01:52.350 ability to govern is very important. We try not to 0:01:52.650 --> 0:01:58.590 make guesses that are not grounded in understanding. So usually 0:01:58.610 --> 0:02:00.670 what we do is we understand, hey, for a certain 0:02:00.690 --> 0:02:03.630 set of conditions, if this happens, then this will happen. 0:02:04.290 --> 0:02:07.630 We'd rather do that, meaning be ready for that thing 0:02:07.670 --> 0:02:10.450 to happen and then anticipate what would happen subsequently. But 0:02:10.490 --> 0:02:14.730 in today's world, where policymakers are such a big part 0:02:14.910 --> 0:02:18.230 of what drives economies and markets. A big part of 0:02:18.250 --> 0:02:22.190 what we're doing is trying to unpack Congress, political landscape 0:02:22.210 --> 0:02:23.850 in Europe, US, China, Japan. 0:02:24.130 --> 0:02:25.940 Well, let's talk about one issue that people are talking 0:02:25.970 --> 0:02:27.860 about a lot these days, which is the size of 0:02:27.880 --> 0:02:30.860 the US debt and deficit. We're running about a $ 2 0:02:30.800 --> 0:02:34.820 trillion annual deficit, $ 40 trillion of total debt. Does that 0:02:34.860 --> 0:02:36.340 worry you as a hedge fund investor? 0:02:36.720 --> 0:02:39.440 Yeah, I think it's a part of a complexion of conditions. 0:02:41.100 --> 0:02:45.780 that set us up in a way that creates a 0:02:45.820 --> 0:02:47.080 lot of risk in the future. 0:02:47.139 --> 0:02:48.310 It's not just that. 0:02:48.990 --> 0:02:52.570 It's the idea that going into a future outlook that 0:02:52.610 --> 0:02:56.870 is extremely optimistic, almost best-case scenario, we're going with an 0:02:57.010 --> 0:03:01.920 arsenal and a buffer, slack, from what policymakers can do 0:03:02.100 --> 0:03:04.280 that is very, very small. Meaning if anything goes wrong 0:03:04.340 --> 0:03:05.840 on the path forward, that will be one of the 0:03:05.900 --> 0:03:10.100 things that creates a levered downward effect on government, on households, 0:03:10.160 --> 0:03:10.640 on corporates. 0:03:10.940 --> 0:03:12.580 Do you worry about the value of the dollar? And 0:03:12.600 --> 0:03:15.200 do your international investors worry about the value of the 0:03:15.240 --> 0:03:17.790 dollar because they're investing with you in dollars, I presume? 0:03:18.090 --> 0:03:21.329 One of the benefits of being unbiased is we don't 0:03:21.370 --> 0:03:23.330 want assets to go up or down, the dollar to 0:03:23.370 --> 0:03:26.550 go up and down. But if you're asking, is that 0:03:26.610 --> 0:03:30.380 something that we think is substantiated significantly, meaning the structural 0:03:30.400 --> 0:03:33.680 weakness of the dollar, I'd go back to say two 0:03:33.700 --> 0:03:36.250 things that I think are important. It's not just because. 0:03:35.990 --> 0:03:38.790 Of the U.S. 's prioritization of the strength of the dollar. 0:03:38.870 --> 0:03:41.350 The thing that's really happening is a shift in the 0:03:41.830 --> 0:03:44.410 macroeconomic paradigm. The reason the dollar was so strong was 0:03:44.750 --> 0:03:48.090 because for 100 years, the world has globalized with the U.S. 0:03:48.130 --> 0:03:50.730 At the center. That globalization had tremendous benefits. 0:03:51.190 --> 0:03:54.560 It also had second-order consequences that caused political implications here 0:03:54.570 --> 0:03:55.130 in the U.S. 0:03:55.350 --> 0:03:56.540 That brought the change of regime. 0:03:57.140 --> 0:03:59.800 And as of three years ago, the macroeconomic paradigm has 0:03:59.840 --> 0:04:05.809 shifted completely from globalization to nationalism. Trump, the tariffs said, hey, no, 0:04:05.830 --> 0:04:09.810 we're talking about efficiency and self-reliance. A lot of those 0:04:09.850 --> 0:04:16.820 dollars or in foreign currencies, those investments remain local. So Japan, Canada, 0:04:16.940 --> 0:04:20.260 South Korea are trying to keep their money inwards versus 0:04:20.339 --> 0:04:21.860 sending it to the U.S. 0:04:22.020 --> 0:04:24.380 Those are foundational changes. Those are changes in. 0:04:24.320 --> 0:04:26.140 The paradigm that are going to remain for a long 0:04:26.180 --> 0:04:29.140 time and are something that investors have to take into 0:04:29.180 --> 0:04:31.240 account versus assume that everything's going to revert. 0:04:31.020 --> 0:04:32.720 Back to the globalizing world that we came out of. 0:04:33.140 --> 0:04:37.919 How do you keep up with what's going on in Japan, China, Australia, Africa, 0:04:37.980 --> 0:04:40.210 Latin America? How do you personally do that? Or do 0:04:40.230 --> 0:04:41.770 you have teams of people that do it and they 0:04:41.850 --> 0:04:43.790 report up to you? That's such a great question. 0:04:44.070 --> 0:04:47.670 Credit to Greg and Ray, the understanding that we're going 0:04:47.690 --> 0:04:49.210 to have to invest in every liquid market in the world. 0:04:49.230 --> 0:04:51.850 And not only that, that even if you didn't, something 0:04:51.870 --> 0:04:53.870 that happens on one side of the world will trickle 0:04:53.910 --> 0:04:56.310 and cause effects and impact something that you care about, 0:04:56.330 --> 0:04:57.890 even if you didn't think it mattered. 0:04:57.630 --> 0:04:59.089 All the way over there. Made. 0:05:01.640 --> 0:05:04.160 We're going to make an early decision to systemize its understanding. 0:05:04.460 --> 0:05:07.340 So the way we track all these things is that 0:05:07.400 --> 0:05:12.060 through 50 years, we've built systems that automatically ingest millions 0:05:12.800 --> 0:05:16.550 of data sources, apply logic to them, and then give 0:05:16.610 --> 0:05:19.170 us the output versus thousands and thousands of humans reading 0:05:19.210 --> 0:05:20.110 every newspaper every day. 0:05:20.310 --> 0:05:23.870 Everybody talks about artificial intelligence these days, or now, as 0:05:23.930 --> 0:05:27.029 some people say, super intelligence. You have a fund, as 0:05:27.089 --> 0:05:31.530 I understand it, that manages money with artificial intelligence. And 0:05:32.290 --> 0:05:35.289 Do you have nobody human to override the artificial intelligence? 0:05:35.310 --> 0:05:35.910 How does that work? 0:05:36.490 --> 0:05:39.390 So we've been on this march of checking what technology 0:05:39.430 --> 0:05:42.669 is capable of. In 2012, Greg Jensen, my partner, who 0:05:42.690 --> 0:05:44.409 was one of the first investors in open AI, the 0:05:44.450 --> 0:05:47.729 first check to Dario and Anthropic, started asking himself the 0:05:47.750 --> 0:05:49.810 question of when will technology not only be able to 0:05:49.920 --> 0:05:52.680 execute human ideas, will we be able to ideate, which 0:05:52.740 --> 0:05:56.140 is the thing that humans were doing in a unique way. 0:05:56.220 --> 0:05:58.100 In 18, we've hired Jeff Zekun, who's now one of 0:05:58.120 --> 0:06:01.910 the most senior scientists in DeepMind, And that led us 0:06:01.970 --> 0:06:05.870 in 23 to say we think AI can ideate, generate 0:06:05.890 --> 0:06:07.770 the ideas that create alpha. And what Greg and I 0:06:07.790 --> 0:06:10.030 decided back then was instead of putting that in the 0:06:10.050 --> 0:06:15.120 hands of humans, to build a factory around AI intelligence. 0:06:15.760 --> 0:06:17.720 We raised a fund from the largest institution clients in 0:06:17.740 --> 0:06:18.060 the world. 0:06:18.600 --> 0:06:23.200 And yes, that fund starts with AI generating insight and 0:06:23.240 --> 0:06:26.100 then doing everything up to execution with humans doing risk 0:06:26.120 --> 0:06:29.270 controls and oversight because There's so much that we're learning, 0:06:29.310 --> 0:06:33.330 but the entire process happening through AI, the ideas that 0:06:33.830 --> 0:06:36.190 the AI is coming up with are different than the 0:06:36.250 --> 0:06:37.870 ideas that are human are coming up with. And that 0:06:37.910 --> 0:06:41.170 just blows your mind thinking what the future holds. 0:06:41.370 --> 0:06:44.890 With artificial intelligence, the debate right now in the United States, 0:06:44.940 --> 0:06:48.050 at least, is should we regulate it or not regulate it? 0:06:48.720 --> 0:06:49.840 You wrote a piece about this. 0:06:49.940 --> 0:06:50.640 What is your view? 0:06:51.040 --> 0:06:57.220 Because we're so bullish on the positive implications of AI. 0:06:57.279 --> 0:06:59.440 We also recognize that anything that could change the world 0:06:59.460 --> 0:07:03.270 that much for the positive could also have severely negative implications. 0:07:03.310 --> 0:07:04.409 Let's go through that quickly. 0:07:05.070 --> 0:07:08.810 From models that exist today, being put in the hands 0:07:08.990 --> 0:07:12.370 of humans with bad intentions, it's like putting a weapon 0:07:12.610 --> 0:07:15.650 in many people's hands. You can see the rate of 0:07:15.730 --> 0:07:19.470 cyber attacks that are AI-based is wildly out of control. 0:07:20.170 --> 0:07:24.130 Very likely negative outcome that could happen. Second thing is 0:07:24.180 --> 0:07:27.660 where everybody's focused is any model that is more intelligent 0:07:27.680 --> 0:07:30.260 than humans. And people should pause and reflect on the 0:07:30.320 --> 0:07:33.950 idea that there has never been an inferior intelligence that 0:07:33.970 --> 0:07:37.550 controlled a superior intelligence. Even if you think there's a 10% 0:07:37.550 --> 0:07:39.270 chance that would happen, I mean, 9% is not going 0:07:39.290 --> 0:07:45.480 to happen. That 10% has catastrophic potential outcomes. And the 0:07:45.540 --> 0:07:48.140 third risk is that even if you avoid both those things, 0:07:48.600 --> 0:07:51.640 they don't happen. You harvest the full benefit of AI 0:07:52.520 --> 0:07:55.200 the societal impact that will happen. Look, our estimates is 0:07:55.260 --> 0:07:58.840 that AI can dislocate 18% of American labor. So think 0:07:58.920 --> 0:08:01.600 about the magnitude of the societal breakdown that could happen. 0:08:02.160 --> 0:08:04.860 So if you wanna avoid those things, what Greg and 0:08:05.040 --> 0:08:08.380 I wrote is you gotta do two things. One, you 0:08:08.400 --> 0:08:14.380 gotta regulate AI for safety because any blip will completely 0:08:14.440 --> 0:08:17.350 halt the development of AI. Could happen tomorrow, could happen 0:08:17.370 --> 0:08:19.910 right after this interview. And the second thing is you 0:08:19.970 --> 0:08:24.690 gotta prepare society learning the lessons from what we failed 0:08:24.730 --> 0:08:27.790 to do with globalization. Because in the end of the day, 0:08:28.510 --> 0:08:33.230 let's remember that this entire technological revolution is for humans. 0:08:33.870 --> 0:08:36.630 Meaning if it doesn't end up benefiting society and humans, 0:08:37.490 --> 0:08:38.110 what's the point? 0:08:38.550 --> 0:08:40.910 Now, one of the hardest things about being a hedge 0:08:40.950 --> 0:08:43.650 fund investor, I believe, is admitting you're wrong about something. 0:08:44.000 --> 0:08:46.100 People have a view. They say, this is what we're 0:08:46.120 --> 0:08:48.540 going to do. How long before you realize the market 0:08:48.600 --> 0:08:50.950 is moving against you before you say, You know, we 0:08:50.970 --> 0:08:51.510 didn't get it right. 0:08:51.530 --> 0:08:52.230 Let's get out of here. 0:08:52.290 --> 0:08:55.630 We are clear from the beginning, from before we deploy 0:08:55.670 --> 0:09:00.110 that idea, what's our expectation of how that idea should perform. 0:09:00.250 --> 0:09:03.230 And the second it breaches those rules, it's not a 0:09:03.250 --> 0:09:05.579 matter of opinion or sticking to your views. It's a 0:09:05.700 --> 0:09:08.900 systematic point of, hey, let's step back and see. This 0:09:08.920 --> 0:09:11.560 is not something we've expected. But the deeper point, you 0:09:11.600 --> 0:09:13.920 want to be a learner. We talked about having a 0:09:13.940 --> 0:09:16.760 community of the steepest learners at Bridgewater. That's the only 0:09:16.780 --> 0:09:18.030 way to understand how the world works. 0:09:18.790 --> 0:09:19.770 You have to love that moment. 0:09:20.350 --> 0:09:22.710 Meaning you have to love the moment where you understand 0:09:23.080 --> 0:09:25.680 that something you thought was right was wrong because that's 0:09:26.360 --> 0:09:29.280 the moment of learning. That's the moment that will make 0:09:29.320 --> 0:09:33.200 you definitionally better. So we aspire to teach people to 0:09:33.240 --> 0:09:35.830 fall in love with that moment instead of to defend 0:09:35.850 --> 0:09:36.670 themselves from that moment. 0:09:36.850 --> 0:09:39.990 So you have a very unusual background for a hedge 0:09:40.030 --> 0:09:44.480 fund CEO. I haven't met any other CEOs of hedge 0:09:44.510 --> 0:09:47.190 funds that work. in the IDF for six years. How 0:09:47.210 --> 0:09:49.780 did you come from the IDF to the hedge fund world? 0:09:49.800 --> 0:09:52.260 I think to understand my path, you really have to 0:09:52.300 --> 0:09:54.980 go back and understand the context that I grew up in. 0:09:55.000 --> 0:10:01.000 Third generation, the Holocaust survivors, grandparents that came from Poland, Libya, 0:10:01.980 --> 0:10:05.179 this very unlikely marriage that gave birth to the first 0:10:05.920 --> 0:10:09.240 type of Israeli, my parents, this mix match of these cultures. 0:10:09.580 --> 0:10:11.900 And in the 80s when I'm born, I get to 0:10:11.970 --> 0:10:14.689 see the tail end of what it's like to take 0:10:14.730 --> 0:10:17.150 a desert and turn it into the state that Israel 0:10:17.170 --> 0:10:23.120 is today. paving roads, building skyscrapers, all of that. And 0:10:23.160 --> 0:10:27.719 it really shapes the kind of person I aspire. 0:10:27.460 --> 0:10:30.600 To be, which is both how I see the. 0:10:30.520 --> 0:10:33.469 Role of previous generations before us, but also my conceptualization 0:10:33.490 --> 0:10:35.090 of what I think is possible. I was a very 0:10:35.230 --> 0:10:41.690 unexceptional teenager, bad student, had really significant problem with anything 0:10:41.710 --> 0:10:42.990 that required conforming. 0:10:43.429 --> 0:10:45.250 Were your parents professionals in Israel? 0:10:45.730 --> 0:10:48.270 My father started as a construction worker, just like the country. 0:10:48.290 --> 0:10:50.850 He started from nothing and then ended up being a 0:10:50.910 --> 0:10:55.130 very successful CEO, the CEO of the largest food manufacturer 0:10:55.190 --> 0:10:55.589 in Israel. 0:10:56.190 --> 0:10:56.990 And my mother was a teacher. 0:10:57.270 --> 0:10:59.570 And when you went to high school, you didn't complete 0:10:59.610 --> 0:11:01.980 high school at the time, as I understand it, and 0:11:02.010 --> 0:11:05.860 you went into the IDF. And under the IDF, you 0:11:05.880 --> 0:11:08.320 have to give two years to the IDF, but you 0:11:08.360 --> 0:11:10.420 gave six years. Were you worried that you were going 0:11:10.440 --> 0:11:11.400 to be killed in the IDF? 0:11:11.900 --> 0:11:13.880 If it's the opportunity to start all over again, from 0:11:13.900 --> 0:11:18.429 being a failed high school student to something that has 0:11:18.470 --> 0:11:20.050 a chance to be successful, which is what the IDF 0:11:20.090 --> 0:11:22.590 did for me, it was a no-brainer. And yes, there 0:11:22.610 --> 0:11:27.030 were many extremely stressful times during my military service. 0:11:27.100 --> 0:11:29.500 After six years in the IDF, you decide you want 0:11:29.520 --> 0:11:30.160 to go to college. 0:11:31.040 --> 0:11:33.620 Had you completed high school? I did not graduate high school. 0:11:35.300 --> 0:11:39.200 And after the IDF, this is at the age of 28, 0:11:39.200 --> 0:11:42.500 I decided to then do my bachelor's degree. And I 0:11:42.559 --> 0:11:44.870 have to go back and do some of the finals 0:11:44.950 --> 0:11:47.090 that the 18 year old do in order to get 0:11:47.110 --> 0:11:50.250 accepted to college. And I only then start my undergraduate 0:11:50.270 --> 0:11:51.630 degree in Herzliya. 0:11:52.030 --> 0:11:53.670 So you go into college and then you did it 0:11:53.710 --> 0:11:55.070 very well in college, is that right? 0:11:55.330 --> 0:11:55.730 You know why? 0:11:55.750 --> 0:11:58.260 Because when you're very worried about something and you think 0:11:58.300 --> 0:12:01.580 you're going to be terrible, you overdo it and then 0:12:01.620 --> 0:12:04.120 you end up, think you're punching a brick wall, but 0:12:04.140 --> 0:12:05.880 you're punching through a paper wall and it went very well. 0:12:06.000 --> 0:12:07.719 How old were you when you graduated from college? 0:12:07.720 --> 0:12:09.780 30, 31. 0:12:09.780 --> 0:12:12.059 Did people tell you you better rush and get something 0:12:12.100 --> 0:12:13.720 done because you're already 31 years old? 0:12:13.900 --> 0:12:16.729 Very much, because I actually finished my undergrad at Wharton. 0:12:16.830 --> 0:12:19.189 So I started it in Herzliya, and because I was 0:12:19.210 --> 0:12:21.229 a very good student, they allowed me the opportunity to 0:12:21.309 --> 0:12:24.130 finish it at Wharton. I used to have students from 0:12:24.190 --> 0:12:26.900 Asia take pictures with me because I was a gray-haired 0:12:27.460 --> 0:12:30.819 student and the undergrad at Wharton. So I definitely felt 0:12:30.840 --> 0:12:34.260 the pressure of being a full generation above the people 0:12:34.280 --> 0:12:34.920 that were my peers. 0:12:35.160 --> 0:12:37.400 You finished your college at Wharton, and did you go 0:12:37.420 --> 0:12:38.380 to Bridgewater right away? 0:12:38.800 --> 0:12:39.020 No. 0:12:39.179 --> 0:12:41.260 Anything that required conforming was a real problem for me. 0:12:42.080 --> 0:12:44.880 I know I want to get more of the globalized 0:12:44.900 --> 0:12:46.219 perspective that I can get here, but I'm thinking if 0:12:46.260 --> 0:12:48.240 I go to McKinsey or a bank, it's not going 0:12:48.260 --> 0:12:48.700 to go well. 0:12:48.720 --> 0:12:49.640 It's going to be a disaster. 0:12:49.660 --> 0:12:54.420 I go to the Israeli mission to the United Nations 0:12:55.040 --> 0:12:58.540 with Ambassador Poursor. This is during the Iran negotiation. And 0:12:58.570 --> 0:13:00.589 then I think I'm thinking I'm going back to Israel. 0:13:00.650 --> 0:13:03.580 And by total coincidence, I get a reach out by 0:13:03.630 --> 0:13:07.099 Ken Kaniyotamur, who you've interviewed, one of our chief investment officers, 0:13:07.800 --> 0:13:10.220 that says, why don't you come interview here? And what 0:13:10.260 --> 0:13:12.020 happens at Bridgewater is the same thing that happens in 0:13:12.059 --> 0:13:16.120 the IDF. It's clear that despite me being incredibly different, 0:13:16.380 --> 0:13:19.709 how I look, how I dress, how I speak, that 0:13:19.750 --> 0:13:22.209 organization is seeing through those things and only cares about 0:13:22.230 --> 0:13:25.130 the things that I'm saying, which means that I might 0:13:25.170 --> 0:13:25.650 have a shot here. 0:13:26.370 --> 0:13:29.650 So you come to Bridgewater and you're An intern, essentially. 0:13:30.510 --> 0:13:32.809 And you're the oldest intern they've ever had, presumably. 0:13:33.730 --> 0:13:34.230 Absolutely. 0:13:34.830 --> 0:13:37.750 So at what point do you realize, hey, you're pretty 0:13:37.790 --> 0:13:38.310 good at this? 0:13:38.610 --> 0:13:42.290 I'm waiting for that moment to come. Truly, at some level. 0:13:42.350 --> 0:13:44.850 I mean, the thing that happens immediately is I understand 0:13:44.890 --> 0:13:48.350 that I'm bringing a baggage that others don't have. The 0:13:48.390 --> 0:13:52.380 military experience, the perspective. And I also understand that there's 0:13:52.520 --> 0:13:55.530 so much, truly, that I don't understand at all. So 0:13:55.550 --> 0:13:58.069 there's a learning experience at the same time that there's 0:13:58.750 --> 0:14:01.569 this sense that I can contribute. That equilibrium has basically 0:14:01.610 --> 0:14:05.230 stayed up until today. I really feel very far from 0:14:05.290 --> 0:14:08.630 mastering what it takes to do this well. 0:14:08.980 --> 0:14:12.400 What was your expertise that enabled Ray and others to say, 0:14:12.440 --> 0:14:14.140 this guy is really a potential CEO? 0:14:14.380 --> 0:14:16.820 I was a plumber of people. I was a manager. 0:14:16.880 --> 0:14:20.060 So I grew on the ground of the research department, 0:14:20.100 --> 0:14:21.500 which means that I learned. 0:14:21.340 --> 0:14:26.010 Deeply how the process worked. Didn't have the ideas. 0:14:26.790 --> 0:14:29.570 You should not give me your money to manage, but 0:14:29.590 --> 0:14:33.030 you can give me your money to manage through managing 0:14:33.070 --> 0:14:35.750 other investors. I grew as a manager and as a 0:14:35.870 --> 0:14:37.930 person that visualized how our investment process works. 0:14:38.320 --> 0:14:42.900 Is Bridgewater a firm that is closed to investors now? Yes. 0:14:42.920 --> 0:14:44.840 So you're not taking new money? 0:14:45.140 --> 0:14:47.820 Our Alpha funds, the main funds, which are Pure Alpha 0:14:48.120 --> 0:14:50.580 and Aya, which is the same concept of Pure Alpha, 0:14:50.640 --> 0:14:55.390 but with AI-driven insights. are both closed to investors, and 0:14:55.430 --> 0:14:58.120 we've been returning billions of dollars over the last couple 0:14:58.160 --> 0:14:59.480 of years, and we're going to do that again this year. 0:14:59.620 --> 0:15:01.900 So if somebody wants to invest with you, it's not 0:15:01.960 --> 0:15:04.380 easy to do because you're not taking more money. Right. 0:15:04.400 --> 0:15:06.740 There are some products that are raising capital. 0:15:06.780 --> 0:15:09.180 We're also trying to make some of the concepts, especially 0:15:09.200 --> 0:15:11.480 in the beta space, accessible to people through ETFs, but 0:15:11.520 --> 0:15:12.380 the main funds are closed. 0:15:12.760 --> 0:15:15.310 But in your current job, you are overseeing how many 0:15:15.350 --> 0:15:16.250 employees do you have? 0:15:16.250 --> 0:15:17.510 1,200. All right. 0:15:17.550 --> 0:15:19.770 So your job is to oversee them, make sure they're happy, 0:15:19.870 --> 0:15:23.020 performing well. Do you ever second guess their investment decisions? 0:15:23.060 --> 0:15:24.700 You say, well, I don't think you should be investing 0:15:24.740 --> 0:15:26.680 that way, do it this way, or you're not doing that? 0:15:27.400 --> 0:15:30.790 I try to focus on question on the process. I 0:15:30.810 --> 0:15:34.030 think that's where my relative advantage is, meaning I looked 0:15:34.070 --> 0:15:36.190 at what the process is and I asked myself, would 0:15:36.210 --> 0:15:38.170 I trust the outcome of a process that looks like this? 0:15:38.450 --> 0:15:42.670 So today, your job is to manage the employees, make 0:15:42.690 --> 0:15:45.240 sure the returns are reasonable. But do you go out 0:15:45.300 --> 0:15:47.800 and meet investors that you already have? And you ever 0:15:47.840 --> 0:15:49.300 try to go out and get new investors or you're 0:15:49.320 --> 0:15:50.360 not looking for new investors? 0:15:50.540 --> 0:15:53.460 Yes, I think that one of the most expanding experience 0:15:53.480 --> 0:15:55.180 that I've had as a CEO relative to the managing 0:15:55.220 --> 0:15:58.380 research is the engagement with our clients. 80% of our 0:15:58.400 --> 0:16:00.990 clients have been with us for 15 years. Coming as 0:16:01.020 --> 0:16:03.750 a CEO to the middle of those relationships, which are 0:16:03.790 --> 0:16:06.369 like knives sharpening knives, these are the smartest people in 0:16:06.390 --> 0:16:10.730 the world, has been eye-opening, especially at a time where 0:16:11.450 --> 0:16:13.010 the world is going through what the world is going 0:16:13.030 --> 0:16:13.310 through now. 0:16:14.120 --> 0:16:15.620 Where things are so fragmented. 0:16:15.640 --> 0:16:18.060 Think about me as an Israeli in the Middle East 0:16:18.620 --> 0:16:22.260 with our Saudi clients, with our Emirati clients, with our 0:16:22.660 --> 0:16:23.440 clients in Qatar. 0:16:24.080 --> 0:16:26.220 There's so much in that. 0:16:26.140 --> 0:16:29.580 Experience that has been reaching Bridgewater, those clients, and me 0:16:29.640 --> 0:16:32.420 personally in a way that has been one of the 0:16:32.440 --> 0:16:33.780 biggest gifts in this job. 0:16:33.940 --> 0:16:36.520 So you manage money, as you just indicated, for countries 0:16:36.620 --> 0:16:40.500 in the GCC, the Gulf Cooperation Council countries. Is there 0:16:40.520 --> 0:16:43.420 a disadvantage or an advantage to being an Israeli if 0:16:43.440 --> 0:16:46.300 you're trying to talk to somebody from Qatar or Saudi Arabia? 0:16:46.840 --> 0:16:50.920 I think like anything in life, in some places, which 0:16:50.980 --> 0:16:52.710 are not depending on which country it is, it depends 0:16:52.750 --> 0:16:53.890 on who is the person on the other side. 0:16:54.430 --> 0:16:56.730 It's an advantage, and in some places it's a disadvantage. 0:16:56.970 --> 0:16:58.950 And do you expect to see peace in the Middle 0:16:59.050 --> 0:16:59.990 East in our lifetime? 0:17:00.310 --> 0:17:02.950 I am extremely worried. 0:17:03.850 --> 0:17:07.390 As a Jew and as an Israeli, we've talked about 0:17:07.410 --> 0:17:10.219 the changes the world is going through. And if you 0:17:10.240 --> 0:17:12.600 think about when was the last time changes like that happened, 0:17:12.800 --> 0:17:16.199 I would have said the change in the global operating system, 0:17:16.440 --> 0:17:19.159 probably the beginning of the previous century, a productivity miracle 0:17:19.200 --> 0:17:21.419 of this size, probably. 0:17:21.000 --> 0:17:21.660 200 years ago. 0:17:21.980 --> 0:17:25.150 Both those things have the potential of creating social. 0:17:26.270 --> 0:17:26.810 Destruction. 0:17:27.670 --> 0:17:31.050 And you know and I know the most vulnerable small 0:17:31.270 --> 0:17:36.369 populations are most at risk when society is falling apart. 0:17:37.170 --> 0:17:40.050 And I look at what's happening in Israel and I 0:17:40.070 --> 0:17:42.850 look at what's happening here with Jewish people in New York, 0:17:43.950 --> 0:17:45.350 and I'm very worried about it. 0:17:45.430 --> 0:17:47.250 What do you think the future of the hedge fund 0:17:47.290 --> 0:17:49.300 world is? Do you think this industry is going to 0:17:49.340 --> 0:17:51.220 keep going this way or do you think it's leveled 0:17:51.300 --> 0:17:52.000 off at this point? 0:17:52.260 --> 0:17:55.440 Given the level of uncertainty, when you stand here today 0:17:55.460 --> 0:17:56.500 and you look forward, you're. 0:17:56.400 --> 0:17:58.440 Saying, well, AI could be amazing. 0:17:59.520 --> 0:18:01.700 It could hit any one of the limits, safety limits, 0:18:02.080 --> 0:18:05.210 fiscal limits, geopolitical limits, outcomes could. 0:18:05.140 --> 0:18:05.740 Be very different. 0:18:06.800 --> 0:18:09.740 Both the ideas of understanding the world and then generating 0:18:09.820 --> 0:18:16.230 uncorrelated alpha, which is something unique to hedge fund with liquidity, makes, 0:18:16.470 --> 0:18:19.950 I believe, the next 10, 15 years probably the most 0:18:20.230 --> 0:18:22.590 meaningful time to try to do what we're doing. 0:18:23.150 --> 0:18:24.380 And the question is, can you do it well? It's 0:18:24.390 --> 0:18:25.280 a very difficult thing to do. 0:18:25.660 --> 0:18:28.359 How do you feel the social benefit is of running 0:18:28.380 --> 0:18:28.940 a hedge fund? 0:18:29.140 --> 0:18:33.440 I actually feel, with zero cynicism, a real.... 0:18:34.650 --> 0:18:37.690 Ability to convert this platform to impact. Greg Jensen, my partner, 0:18:37.730 --> 0:18:41.230 and I are very focused on making sure that our 0:18:41.290 --> 0:18:43.419 synthesis of the risks of AI and what should be 0:18:43.440 --> 0:18:47.680