an ultra mini-series adventure

in 30 minutes and in eight episodes.

Episode Four:

The Abyss

We progress forward until we encounter setbacks.

Whether or not we get out of them

and continue forward or spiral downward

depends on whether or not we're willing

to face the failure objectively

and make the right decisions to

turn the loop upward again.

Something terrible happened to me in 1982,

when I bet everything on a depression

that never came.

(dramatic orchestral music)

(birds chirping)

The period between 1979 and 1982

was one of extreme turbulence.

For the global economy,

the markets,

and for me.

And I believed that the U.S. economy,

with the world economy tied to it,

was headed toward a catastrophe.

This view was extremely controversial.

I wanted the great upside

and very publicly took a big risk and was wrong.

Dead wrong.

After a delay,

the stock market began a big bull market

that lasted 18 years and the U.S. economy

enjoyed the greatest growth period in its history.

(birds chirping) This experience was

like a blow to my head with a baseball bat.

I had to cut my losses

so that my company, Bridgewater,

was left with one employee:

Me.

(door slams shut)

I was so broke, I had to borrow $4,000

from my dad to pay my bills,

but even worse was having to let go

the people I cared so much about.

I wondered whether I should give up my dream

of working for myself and play it safe

by working for someone else in a job

that would require me to put on a tie

and commute every day.

Though I knew that, for me,

taking less risk would mean having

a less great life.

Being so wrong,

and especially being so publicly wrong,

was painfully humbling.

I am still shocked and embarrassed

by how arrogant I was

in being totally confident

in a totally incorrect view.

(dramatic orchestral music)

Though I'd been right much more than I'd been wrong,

I had let one bad bet erase all my good ones.

I thought very hard about the relationship

between risk and reward and how to manage them,

but I couldn't see a path forward

that would give me the rewards I wanted

without unacceptable risk.

This kind of experience happens to everyone.

It will happen to you.

You will lose something or someone

you think you can't live without.

Or you will suffer a terrible illness or injury.

Or your career will fall apart before your eyes.

You might think that your life is ruined

and that there's no way to go forward,

but it will pass.

I assure you

that there is always a best path forward

and you probably just don't see it yet.

You just have to reflect well to find it.

You have to embrace your reality.

In Episode 5, I'll show you how this

realization drove me to wonder how reality works

and how to best deal with it.