What Ray Dalio thinks…
I think one of the tools that can help you build a successful business is to try and find other people who have done quite well. Study them, their mannerisms, their psychology, how they think and interact with people, their products, services, their staff and customers. Successful people leave lots of clues - everywhere, and one of the things I personally have invested in over the last twenty odd years is to find people who have done well and try and learn as much as possible of them.
I am in an incredibly fortunate position of course, as in my role in the real estate and finance markets, I have been able to work for and alongside many incredible entrepreneurs and management teams, who have built a lot of successful businesses.
Ray Dalio (born August 8, 1949) is a prominent American billionaire investor, hedge fund manager, and author, best known for founding Bridgewater Associates www.bridgewater.com which grew into the world's largest hedge fund. He is recognized for his "principles" on life and investing, his "radical transparency" management style, and his macroeconomic analysis of debt cycles and global economic trends.
Dalio, an industry TITAN, is very active online, and is someone I have been reading about and studying for many years. He has a huge amount of experience in business, and more importantly, has lived and worked through many of the economic cycles over the last fifty odd years. Recently he has been quite vocal on how he sees the world today, and what might be around the corner for business owners, consumers, global politics and world order.
In one of his latest contributions to mainstream publications, he points to five forces converging right now:
"There are basically five big forces through history that drive everything."
Force #1: The debt cycle "First, there's the money, credit, debt, economic cycle in which there's a building up of debt in a cyclical way that becomes too large and we're going to have problems. We're going to have a government debt problem." In Dalio's framing, this is what's changing our monetary order.
Force #2: Internal conflict "The second big force through time is the internal conflict force. The left and the right. Differences in wealth and values causing a conflict that we're seeing it changing our political order." This is what's changing our political order internally.
Force #3 : The great world order "How countries deal with each other. When there's a rising power challenging existing power." Dalio sees a major shift underway: "Now we are going from multilateralism which is largely an American world order type of thing to a unilateral world order in which there's great conflict."
Force #4 : Acts of nature "Droughts, floods, and pandemics." The historical wildcard that compounds every other pressure.
Force #5 : Technology "Technology changing and how they are coming together are the main forces behind this." Dalio's core warning is about convergence. No single force is the whole story: "There can't be imbalances anymore in that environment."
As a business owner who works in the professional services field with our GDP Companies, I like to listen to people like Dalio, as If I can improve my understanding of how he sees the world moving forward, I can take this on board and use that information to advise our clients and our businesses in terms of the strategic direction they may take.
In last week’s newsletter I spoke about the GILT MARKET and how investors are now pricing in the risk of investing into the UK ECONOMY. Over the last few days, it’s not just the UK ECONOMY investors are concerned about, investors have concerns about many of the world’s economies right now, and as a result, the cost of money is increasing again across the globe.
Last week, we did get some good news from the Bank of England as they decided to hold the base rate at 3.75%, however instead of pricing in rate cuts for the remainder of 2026, the forecasters are now pricing in interest rate increases for the UK, US and Europe. From a business owners’ perspective, particularly those who are relying on debt and credit, the fact that rates may be about to increase soon, needs to come onto your own radar!
UNSECURED FINANCE LEADING THE WAY
One very active area our own business which is proving popular with our clients is the utilisation of the Unsecured Finance Market. Gross SME lending totalled just over £62 billion in 2024 (source. British Business Bank) whilst Unsecured finance products, such as business loans, overdrafts, and revolving credit facilities, accounted for an estimated 25–30% of that total, coming in at approximately £15–20 billion, which is a significant number.
Source – Bank Of England Credit Conditions Survey
There are several reasons why business owners are drawn to the Unsecured Lending market, some of which, I have set out below.
Primary funding source – Most UK SMEs lack assets to pledge, making unsecured loans, overdrafts, and revolving credit their main route to external finance.
Speed and accessibility – Approval is faster and documentation lighter than secured lending, letting businesses act on time-sensitive opportunities.
Cash-flow management – Covers everyday gaps between paying suppliers and receiving customer payments, keeping operations stable.
Growth enabler – Funds hiring, inventory, marketing, and expansion without forcing owners to tie up property or equipment.
No Hassle – For the most part the process is hassle free, as once you provide your broker with the information, the next correspondence you would get is often letter of offer (assuming your business meets the criteria).
This can happen within 48 hours. This year alone, we have secured over £2 million of unsecured loans for our clients. Although the cost of funds is more expensive than the more traditional longer term secured loans, the hassle-free nature of the experience, along with the speed of which the funds can hit your account, seems to be the key driver for business owners to go down this route.
The takeaway this week being whether it’s secured or unsecured finance you need to grow your business, we have it covered for you at GDP!
Until next week, look after yourself!
Best,
Conor