- Bridgewater Associates, L.P. co-chief investment officer and co-chairman Ray Dalio recently paid tribute to former Federal Reserve chairman Paul Volcker
In a LinkedIn post, Bridgewater Associates, L.P. co-chief investment officer and co-chairman Ray Dalio recently paid tribute to Paul Volcker, the former chairman of the Federal Reserve who passed away earlier this month. In the tribute, Dalio said that Volcker was the greatest American hero he has ever known. With a net worth of about $19 billion, Dalio oversees $150 billion of assets under management as the head of Bridgewater.
“In 1970-71, I watched how he managed the breakdown of the dollar monetary system with great skill. In 1979-84, I watched him break the back of inflation, which was essential for our economic system’s survival and required great character to do the right thing under strong criticism because tightening monetary policy meant a lot of people had to suffer a lot,” said Dalio referring to Volcker. “At the time, he was the most powerful man in the world because, although the U.S. president could push the nuclear button, Volcker controlled how much money and credit there was in the world, which had a much bigger impact than anything else at the time.”
Dalio pointed out that Volcker put working in the service of our country above all else and always put doing the right thing and difficult things “ahead of the expedient and partisan things.” Plus Dalio described him as a man “who had great wisdom, humility, and classic heroism in which he sacrificed his well-being for the well-being of others.” Volcker had served as the Fed chairman between 1979 until 1987 and helped balance the economy during a time of high inflation.
Even after Volcker left the Federal Reserve, he worked as a financial advisor and chaired the Independent Committee of Eminent Persons (also known as the Volcker Commission). The Commission was created with a memorandum of understanding on May 2, 1996, between the World Jewish Restitution Organization, the World Jewish Congress and the Swiss Bankers Association. The objective of the committee is to identify accounts in Swiss banks of victims of Nazi persecution that were dormant since World War II — which otherwise were not made available to the victims or their heirs. About 46,000 accounts were opened during the Holocaust.
“After that I watched him take on and handle the highly politically-charged investigation of corruption in the UN oil-for-food program in Iraq, once again because he was the most principled and capable person who everyone believed would do the right things rather than politically expedient things,” added Dalio. “Over the last 50 years, I watched presidents from both political parties and heads of states from all important countries in the world rely on his great capabilities and character to provide them with wise guidance. I knew him personally as a man who had great wisdom, humility, and classic heroism in which he sacrificed his well-being for the well-being of others.”
Volcker was also the chairman of the Economic Recovery Advisory Board under President Barack Obama from February 2009 until January 2011. Volcker was critical of the banks during the financial crisis and pointed out that their responses were inadequate so he called for more regulation. Volcker called for a break-up of the largest banks in the country and prohibited deposit-taking institutions from handling riskier activities like proprietary trading, private equity, and hedge fund investments. And Volcker left the board when its charter expired on February 6, 2011.
In January 2010, President Obama had proposed bank regulations called “The Volcker Rule,” in reference to Volcker’s aggressive pursuit of the regulations. And Volcker appeared with President Obama at the announcement.
“Even after he knew that he was approaching his end, when we would talk, he never worried about himself as much as he worried about the well-being of our country and those who served it,” explained Dalio. “When I asked him how he was doing, he would briefly give an accurate summary of his health and then move on to what was most important to him, which was making sure that public servants were well-educated and equipped to serve our nation well.”
Volcker also published a book called “Keeping At It: The Quest for Sound Money and Good Government” with Bloomberg LP Editor Christine Harper.
In an interview, Dalio asked Volcker to talk about his principles. During the interview, Dalio noted that Volcker is a great American hero. Here is the interview:
Pulse 2.0 may receive a commission for purchases made through this article
