this video is brought to you by six park let them help to guide you on your passive investing journey and use the referral link in the description to access lower account minimums to help you get started on their platform with less so for context ray dalio has been traveling to china since the NUMBER_TOKENs and has had some incredible exposure to chinese business and also chinese leadership over that time so much so he's really been able to understand their ideology and economic policies in depth so i wanted to firstly start with this clip of him uh discussing a common misperception of westerners looking into china or is you do you envision a beijing that's moving to a new territory well you have um daughter and son-in-law in shanghai and you and and so we get living in real time we're living in real time and the more you have contact i think the more you understand it i don't think it's well understood for a long time the the question is how can communism and capitalism coexist that's the riddle you have to answer and he had to answer it a while ago and what do these people want at the top and what they the answer to that riddle was told also by deng xiao ping when he was asked he said it's glorious to be rich and then they asked about capitalism and he says it doesn't matter if it's a black cat or a white cat just as long as it catches mice and so the idea is producing wealth so in raise eyes that's the first thing people get wrong when looking at china they think the united states is capitalist and china is communist and we don't like communism but when you look at the principles behind each approach they're trying to do the same thing they're trying to increase the wealth of their nation historically they've had quite different approaches in achieving that but recently china has been able to embrace many pillars of capitalism in order to accelerate the growth of their country's wealth so forget the american capitalist china communist thinking china's goal is simply to embrace the economic and political structures that increase the wealth of their nation and lead to as this clip will talk about common prosperity so we have four things that are really going on in china if if you understand their intent um uh common prosperity is the word now okay and it has been the objective to raise money and then to to broaden the base of right okay that's common prosperity so if you look at their tax rates they're lower than the united states if you look at the measures of almost capitalism they have as much capitalism or more capitalism much more so than europe for example and then and now they're in a prospect pro to broaden that so i think there's a tendency and an understandable tendency to think because they are maoist and capital and and communist that they're going to uh go back to that kind of a thing the then they're not um deng xiaoping excuse me um shishi pink just um for example introduced the newest stock market in beijing he made a point of being the one who introduced the market in beijing to the small and medium-sized enterprises they know that it catches mice and so the issue is that the capitalist is not in control the issue is that there's a system for the whole system and then
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