The US dollar (and the dollar of most countries) is not backed by anything. Therefore if the amount of money in circulation is x, and overnight it becomes 2x, that must mean the value of the dollar has halved.

During COVID, the US government injected $4.6 trillion into the economy. If you didn't get at least 13,800$, you lost money.

But the bigger point here is the value of money has significantly decreased - And it's not just what the inflation calculators are saying. Let's look at some examples:

Besides this graph suggesting the value of your salary has halved in 20 years, it begs a deeper question - Where is the money going? Is the economy just bad? Or is there a group benefiting from this?

We could analyze government debt vs inflation (hint: the governments are going bankrupt, and the only way to stop that is a wealth tax), but that's a whole different topic.

Look at the distribution of wealth of the top 5 richest people in the world:

Oh look at that, we found the missing money.

So as an individual investor, what can we do with this information? Well billionaires have most of their value in their assets - Specifically, publicly traded assets.

S&P 500 index:

The takeaway is that simple.

1. Have rich parents
2. If you fail at step 1, try again
3. Buy in the S&P 500

As long as your living expenses are a small enough fraction of your take-home income, you can still stay on top of the curve. Save and invest in index funds.