How This Study Is Organized
As with all my studies, I will attempt to convey what I learned in both a very short, simple way and in a much
longer, more comprehensive way. To do so, I wrote this book in two parts.
Part 1 summarizes all that I learned in one very simplified archetype of the rises and declines of empires, drawing
from all my research of specific cases. In order to make the most important concepts easy to understand, I will
write in the vernacular, favoring clarity over precision. As a result, some of my wording will be by and large
accurate but not always precisely so. (I will also highlight key sentences in bold so that you can just read these and
skip the rest to quickly get the big picture.) I will first distill my findings into an index of total power of empires,
which provides an overview of the ebbs and flows of different powers, that is constituted from eight indexes of
different types of power. Then I go into an explanation of these different types of power so you can understand
how they work, and finally I discuss what I believe it all means for the future.
Part 2 shows all the individual cases in greater depth, sharing the same indices for all the major empires over the
last 500 years. Providing the information this way allows you to get the gist of how I believe these rises and
declines work by reading Part 1 and then to choose whether or not to go into Part 2 to see these interesting cases
individually, in relation to each other, and in relation to the template explained in Part 1. I suggest that you read
both parts because I expect that you will find the grand story of the evolutions of these countries over the last 500
years in Part 2 fascinating. That story presents a sequential picture of the world’s evolution via the events that led
the Dutch empire to rise and decline into the British empire, the British empire to rise and decline into the US
empire, and the US empire to rise and enter its early decline into the rise of the Chinese empire. It also compares
these three empires with those of Germany, France, Russia, Japan, China, and India. As you will see in the
examinations of each of them, they all broadly followed the script, though not exactly. Additionally, I expect that
you will find fascinating and invaluable the stories of the rises and declines of the Chinese dynasties since the year
600 just like I did. Studying the dynasties showed me what in China has been similar to the other rises and declines
(which is most everything), helped me to see what was different (which is what makes China different from the
West), and gave me an understanding of the perspectives of the Chinese leaders who all study these dynasties
carefully for the lessons they provide.
Frankly, I don’t know how I’d be able to navigate what is happening now and what will be coming at us without
having studied all this history. But before we get into these fascinating individual cases, let’s delve into the
archetypical case.
IMPORTANT DISCLOSURES
Information contained herein is only current as of the printing date and is intended only to provide the observations
and views of Bridgewater Associates, L.P. (“Bridgewater”) as of the date of writing unless otherwise indicated.
Bridgewater has no obligation to provide recipients hereof with updates or changes to the information contained
herein. Performance and markets may be higher or lower than what is shown herein and the information,
assumptions and analysis that may be time sensitive in nature may have changed materially and may no longer
represent the views of Bridgewater. Statements containing forward-looking views or expectations (or comparable
language) are subject to a number of risks and uncertainties and are informational in nature. Actual performance
could, and may have, differed materially from the information presented herein. Past performance is not indicative
of future results.
Bridgewater research utilizes data and information from public, private and internal sources, including data from
actual Bridgewater trades. Sources include, the Australian Bureau of Statistics, Barclays Capital Inc., Bloomberg
Finance L.P., CBRE, Inc., CEIC Data Company Ltd., Consensus Economics Inc., Corelogic, Inc., CoStar Realty
Information, Inc., CreditSights, Inc., Credit Market Analysis Ltd., Dealogic LLC, DTCC Data Repository (U.S.),
LLC, Ecoanalitica, EPFR Global, Eurasia Group Ltd., European Money Markets Institute – EMMI, Factset
Research Systems, Inc., The Financial Times Limited, GaveKal Research Ltd., Global Financial Data, Inc., Haver
Analytics, Inc., The Investment Funds Institute of Canada, Intercontinental Exchange (ICE), International Energy
Agency, Lombard Street Research, Markit Economics Limited, Mergent, Inc., Metals Focus Ltd, Moody’s
Analytics, Inc., MSCI, Inc., National Bureau of Economic Research, Organisation for Economic Cooperation and