Your 401(k) is a Ponzi
And you're getting wiped out too.
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Your wealth is a Ponzi – or at least the 50% that matters.
More than $10 trillion sits in 401(k)s, with huge allocations to U.S. equities and government bonds. We always knew the U.S. was a Ponzi… now the stock market is too.
In fact, the bond market and the stock market are more related than ever. Not necessarily in correlation – but in actual substance.
This makes the 60/40 portfolio – that allocates 60% into equities and 40% into bonds – look a lot less rational than it used to be.
I know you may disregard this as sensational – but by the end of this piece, you’ll understand exactly why the mechanism supporting your wealth is far more Ponzi-like than you think.
And Yoda will tell you what to do about it.
Now let's review the three layers to the Ponzi, before we analyse what happens when they reverse.
