Page 151 - Ray Dalio - Principles

new adaptations and new inventions that bring new products,
organizations, and human capabilities to new and higher levels of
development (as shown in the top diagram on the facing page); or
decline and death, which looks like the diagram at bottom left.

Think of any product, organization, or person you know and you
will see that this is true. The world is littered with once-great things
that deteriorated and failed; only a rare few have kept reinventing
themselves to go on to new heights of greatness. All machines
eventually break down, decompose, and have their parts recycled to
create new machines. That includes us. Sometimes this makes us sad
because we’ve become attached to our machines, but if you look at it
from the higher level, it’s really beautiful to observe how the
machine of evolution works.

From this perspective, we can see that perfection doesn’t exist; it
is a goal that fuels a never-ending process of adaptation. If nature, or
anything, were perfect it wouldn’t be evolving. Organisms,
organizations, and individual people are always highly imperfect but
capable of improving. So rather than getting stuck hiding our
mistakes and pretending we’re perfect, it makes sense to find our
imperfections and deal with them. You will either learn valuable
lessons from your mistakes and press on, better equipped to succeed
—or you won’t and you will fail.

As the saying goes:
d. Evolve or die. This evolutionary cycle is not just for people but for
countries, companies, economies—for everything. And it is
naturally self-correcting as a whole, though not necessarily for its
parts. For example, if there is too much supply and waste in a
market, prices will go down, companies will go out of business, and
capacity will be reduced until the supply falls in line with the
demand, at which time the cycle will start to move in the opposite
direction. Similarly, if an economy turns bad enough, those
responsible for running it will make the political and policy changes
that are needed—or they will not survive, making room for their
replacements to come along. These cycles are continuous and play
out in logical ways—and they tend to be self-reinforcing.