I'm not saying this to scare you

I'm saying this to prepare you

If you're in your 20s and 30s and you're only relying on the S&P 500 to save for retirement, I think you're heading for a trap

Let me explain:

Most people think the S&P 500 is all they need to retire

I think this is an assumption that will NOT play out

Inflation is going to accelerate in the coming years because the Fed is starting to lower interest rates to incentivize spending

The US government is about to start spending A LOT MORE

Right now the S&P 500 is performing well, giving investors around 10-12% returns in nominal terms (not inflation-adjusted)

In nominal terms, this will probably go up (money printing will accelerate because the US government will need to spend more to achieve the same goals)

In real terms (inflation-adjusted), the S&P 500's returns will drop

The S&P 500 has been an excellent way to escape inflation

It's also liquid relative to other assets (eg. Real estate is NOT liquid)

But the S&P 500 now has a serious competitor:

Instead of passively investing in stocks, investors can also passively buy Bitcoin

Studying, purchasing, and storing Bitcoin properly could require hundreds of hours of research before January 2024, when Bitcoin ETFs were launched

But now it's just as easy as buying stocks

The nominal return on the S&P 500 will always be great because it's directly influenced by the amount of money being printed

The amount of money being printed will increase forever as the dollar loses its purchasing power and purchases fewer goods and services

Most people who want to adopt the S&P 500 as a savings vehicle have probably already done so

This means in the coming years, the flow of passively invested real dollars going into the S&P 500 will decrease as savers favor Bitcoin because of the lower risk profile

This is going to take time; it won't happen overnight

Most people don't even understand 1% of what there is to know about Bitcoin

It takes a very long time to understand why Bitcoin is less risky than the S&P 500, and this is the biggest barrier for most savers

They understand the old system and they know that more US dollars will be printed forever, so the S&P 500 will continue rising forever

But they haven't considered that the form of money the world accepts for goods and services could change

If the money changes, so does the measuring stick for seeing how much value you hold...

In terms of US Dollars, the S&P 500 looks great; that's because holding US Dollars for very long means your wealth is disappearing

As more dollars are printed, previously issued dollars are devalued, FORCING SAVERS TO SPEND THEIR MONEY

The financially illiterate savers keep dollars because they don't understand that the dollar is being devalued - they see it in their day-to-day lives, but they can't connect the dots

The financially literate savers spend their money on things that they think will increase in value over time - eg. The S&P 500

The S&P 500 has performed VERY well over the last 28 years - for every dollar you invested, you would ~$9.00 back!

But what if we change the money?

What if the measuring stick stops growing?

What if the world no longer accepts dollars for goods and services, because dollars can be printed at will?

What if the world moves to Bitcoin?

In terms of Bitcoin, the S&P 500 looks TERRIBLE

The S&P 500 has lost 99.9% of its value already in terms of Bitcoin and it will KEEP losing value because the smart savers will be diversifying OUT of stocks

Demand for Bitcoin ⬆️

Demand for S&P 500 ⬇️

The Bitcoin ETFs are a gateway to allowing Wall Street to buy Bitcoin instead of having to rely on the traditional assets they are already investing in

I think a whole new index of GLOBAL companies will be built on top of the Bitcoin

This new index of global companies will be the new S&P 500, while the current S&P 500 companies fade into irrelevance if they don't adopt Bitcoin