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Dimitry Nakhla | Babylon Capital®
RT @arpangup: When Shohei Ohtani was a high school freshman, he created a detailed "dream sheet" with one central goal: to be the #1 draft pick for 8 NPB (Nippon Professional Baseball) teams.
It was a 64-cell roadmap based on a framework called the Harada Method.
Here's exactly what Shohei did 👇
1. First, some history.... The Harada Method was created by Takashi Harada, a Japanese junior high track coach. He took a team ranked last out of 380 schools and, using his system, turned them into the #1 team in the region within 3 years. They held that top spot for the next 6 years.
2. You start by placing your main goal in the center of an 8x8 grid. For Ohtani, this was "be the #1 draft pick."
3. Next, you identify 8 critical supporting pillars needed to achieve that goal. These surround the main goal.
Ohtani's 8 pillars were:
• Body
• Control
• Sharpness
• Speed
• Pitch Variance
• Personality
• Karma/Luck
• Mental Toughness
4. You then break down each of those 8 pillars into 8 smaller, actionable tasks or daily routines.
This fills out the entire 64-cell grid, turning a massive dream into a concrete, daily action plan.
To improve his karma, he listed tangible actions like:
• Showing Respect to Umpires
• Picking up trash
• Being positive
• Being someone people want to support
5. The method goes far deeper than just technical skills. It forces you to analyze your weaknesses and build confidence. It also has a highlight on service to others, emphasizing that humility and contributing to your community are essential for personal success.
6. The key to the system is daily execution and accountability. Once the 64-cell chart is complete, you turn the tasks and habits into a daily diary and a "Routine Check Sheet." It’s designed to transform abstract intentions into a measurable, daily practice.
tweet
RT @arpangup: When Shohei Ohtani was a high school freshman, he created a detailed "dream sheet" with one central goal: to be the #1 draft pick for 8 NPB (Nippon Professional Baseball) teams.
It was a 64-cell roadmap based on a framework called the Harada Method.
Here's exactly what Shohei did 👇
1. First, some history.... The Harada Method was created by Takashi Harada, a Japanese junior high track coach. He took a team ranked last out of 380 schools and, using his system, turned them into the #1 team in the region within 3 years. They held that top spot for the next 6 years.
2. You start by placing your main goal in the center of an 8x8 grid. For Ohtani, this was "be the #1 draft pick."
3. Next, you identify 8 critical supporting pillars needed to achieve that goal. These surround the main goal.
Ohtani's 8 pillars were:
• Body
• Control
• Sharpness
• Speed
• Pitch Variance
• Personality
• Karma/Luck
• Mental Toughness
4. You then break down each of those 8 pillars into 8 smaller, actionable tasks or daily routines.
This fills out the entire 64-cell grid, turning a massive dream into a concrete, daily action plan.
To improve his karma, he listed tangible actions like:
• Showing Respect to Umpires
• Picking up trash
• Being positive
• Being someone people want to support
5. The method goes far deeper than just technical skills. It forces you to analyze your weaknesses and build confidence. It also has a highlight on service to others, emphasizing that humility and contributing to your community are essential for personal success.
6. The key to the system is daily execution and accountability. Once the 64-cell chart is complete, you turn the tasks and habits into a daily diary and a "Routine Check Sheet." It’s designed to transform abstract intentions into a measurable, daily practice.
The legend continues!
Shohei Ohtani is the NL MVP for the second straight season! https://t.co/aVC7HqxENQ tweet
Offshore
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EndGame Macro
A Rally With an Expiration Date
Both versions of the chart…BTC vs USD and BTC vs EUR are telling the same story, which is what makes them useful. Bitcoin didn’t just lose momentum in dollar terms; it lost momentum in euro terms too. That takes the maybe it’s just currency noise argument off the table.
You can see the pattern clearly: Bitcoin pushed into its highs, stalled out, and then rolled over while the longer term cycle curve (the pink line) already peaked and started bending down. That kind of timing mismatch, price still hanging near the top while the underlying cycle is already turning is usually how topping structures form. The momentum line at the bottom confirms it: strength has been leaking for months even while price was grinding near the highs.
Big picture this doesn’t look like the beginning of something. It looks like the part of the cycle where the market exhales and starts handing the baton to the downside.
The Near Term Window vs the Real Turn
The tricky part is that the next few months still give Bitcoin some breathing room. The macro setup into December and early January is probably the softest backdrop we’ll get for a while and with two Fed cuts already behind us, QT ending on December 1, and year end flows pushing more cash back into the system. Funding feels easier, not harder. That’s exactly the kind of environment where Bitcoin can stabilize after a sharp drop and put together a bounce.
And honestly, a bounce makes sense. Positioning got washed out, sentiment flipped fast, and the broader market still wants to believe in a constructive story into year end. You tend to get a reflex move in that kind of setup, a rally that feels strong, but doesn’t quite have the depth behind it to become a new trend.
But once you get into Q1 and especially into Q2, the tone shifts. Treasury starts rebuilding the TGA, tax season drains liquidity, and issuance ramps back up. With the RRP pool basically gone, that tightening hits bank reserves directly. You don’t need a dramatic shock for risk appetite to fade, the plumbing just gets a little less forgiving. Layer on a softening labor market, some pressure on earnings, and credit spreads that stop tightening, and the market becomes a lot more sensitive to downside surprises.
That’s usually when Bitcoin moves from buy the dip to sell the bounce.
So the cleanest way to think about it is this:
•Into year end and early January:
Bitcoin likely finds support and bounces. It’s a decent window for relief.
•Into Q1–Q2 2026:
Liquidity turns down, not up. That’s when Bitcoin usually struggles. The chart’s longer cycle curve is already pointing that way.
In other words the bounce is probably real, but it’s not the start of the next leg. It’s the last good breath before the harder part of the cycle shows up.
tweet
A Rally With an Expiration Date
Both versions of the chart…BTC vs USD and BTC vs EUR are telling the same story, which is what makes them useful. Bitcoin didn’t just lose momentum in dollar terms; it lost momentum in euro terms too. That takes the maybe it’s just currency noise argument off the table.
You can see the pattern clearly: Bitcoin pushed into its highs, stalled out, and then rolled over while the longer term cycle curve (the pink line) already peaked and started bending down. That kind of timing mismatch, price still hanging near the top while the underlying cycle is already turning is usually how topping structures form. The momentum line at the bottom confirms it: strength has been leaking for months even while price was grinding near the highs.
Big picture this doesn’t look like the beginning of something. It looks like the part of the cycle where the market exhales and starts handing the baton to the downside.
The Near Term Window vs the Real Turn
The tricky part is that the next few months still give Bitcoin some breathing room. The macro setup into December and early January is probably the softest backdrop we’ll get for a while and with two Fed cuts already behind us, QT ending on December 1, and year end flows pushing more cash back into the system. Funding feels easier, not harder. That’s exactly the kind of environment where Bitcoin can stabilize after a sharp drop and put together a bounce.
And honestly, a bounce makes sense. Positioning got washed out, sentiment flipped fast, and the broader market still wants to believe in a constructive story into year end. You tend to get a reflex move in that kind of setup, a rally that feels strong, but doesn’t quite have the depth behind it to become a new trend.
But once you get into Q1 and especially into Q2, the tone shifts. Treasury starts rebuilding the TGA, tax season drains liquidity, and issuance ramps back up. With the RRP pool basically gone, that tightening hits bank reserves directly. You don’t need a dramatic shock for risk appetite to fade, the plumbing just gets a little less forgiving. Layer on a softening labor market, some pressure on earnings, and credit spreads that stop tightening, and the market becomes a lot more sensitive to downside surprises.
That’s usually when Bitcoin moves from buy the dip to sell the bounce.
So the cleanest way to think about it is this:
•Into year end and early January:
Bitcoin likely finds support and bounces. It’s a decent window for relief.
•Into Q1–Q2 2026:
Liquidity turns down, not up. That’s when Bitcoin usually struggles. The chart’s longer cycle curve is already pointing that way.
In other words the bounce is probably real, but it’s not the start of the next leg. It’s the last good breath before the harder part of the cycle shows up.
Will Bitcoin bounce soon? Yes, within a few days (see my recent analysis).
But don’t get too excited—it won’t last long, likely just a couple of months.
The weekly chart’s longer cycles are pointing to a weak 2026. And this isn’t just in USD terms (the top), but also against other currencies, including the EUR (the bottom).
Interested in my STOCK MARKET OUTLOOK? Grab my FREE eBook "1-Year US Stock Market Outlook.” Download 👇
https://t.co/IgSRysWe1k
------------- tweet
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EndGame Macro
Fewer Companies, Bigger Buybacks And The Real Story
The number of US listed companies keeps drifting lower, while cumulative buybacks from the S&P 500 keep climbing almost in a straight line. But once you sit with it for a moment, it hits a deeper point about how the US market has quietly changed over the last 25 years.
The drop in listed companies isn’t because the economy withered. It’s because more of corporate America lives outside the public markets now. You’ve got founders selling to private equity instead of going public, big firms buying smaller ones before they ever reach scale, and regulations that make going public feel like more trouble than it’s worth. The result is a steady drip of delistings and acquisitions that slowly shrink the roster.
On the other side, the companies that are public especially the large ones have spent the last two decades aggressively buying back their own shares. Sometimes it’s funded by strong cash flows, sometimes by cheap debt, but the effect is the same: the supply of public equity keeps getting smaller.
Why It Matters
When you put those two forces together, you get a market where scarcity does a lot of the heavy lifting. You’ve got fewer public companies to choose from and fewer shares circulating from the companies that remain. Meanwhile, demand for equities only grows, because retirement accounts, index funds, sovereign wealth funds, and global investors are all piling into the same shrinking pool.
That combination helps explain why the US market looks so unstoppable compared to the rest of the world. It’s not just earnings strength or innovation stories, it’s the structure itself. The public market has become more concentrated, more top heavy, and more dependent on the same handful of giants that keep shrinking their float year after year.
It’s not necessarily a bad thing, but it does mean the market behaves differently. It’s more sensitive to what the big players do, and it’s more prone to long stretches where valuations stay elevated because the supply of investable public equity keeps tightening.
In a way, the chart is showing you the quiet engine behind two decades of US outperformance: consolidation, buybacks, and the slow disappearance of smaller public companies. It’s a reminder that the strength on the surface isn’t just cyclical, it’s structural.
tweet
Fewer Companies, Bigger Buybacks And The Real Story
The number of US listed companies keeps drifting lower, while cumulative buybacks from the S&P 500 keep climbing almost in a straight line. But once you sit with it for a moment, it hits a deeper point about how the US market has quietly changed over the last 25 years.
The drop in listed companies isn’t because the economy withered. It’s because more of corporate America lives outside the public markets now. You’ve got founders selling to private equity instead of going public, big firms buying smaller ones before they ever reach scale, and regulations that make going public feel like more trouble than it’s worth. The result is a steady drip of delistings and acquisitions that slowly shrink the roster.
On the other side, the companies that are public especially the large ones have spent the last two decades aggressively buying back their own shares. Sometimes it’s funded by strong cash flows, sometimes by cheap debt, but the effect is the same: the supply of public equity keeps getting smaller.
Why It Matters
When you put those two forces together, you get a market where scarcity does a lot of the heavy lifting. You’ve got fewer public companies to choose from and fewer shares circulating from the companies that remain. Meanwhile, demand for equities only grows, because retirement accounts, index funds, sovereign wealth funds, and global investors are all piling into the same shrinking pool.
That combination helps explain why the US market looks so unstoppable compared to the rest of the world. It’s not just earnings strength or innovation stories, it’s the structure itself. The public market has become more concentrated, more top heavy, and more dependent on the same handful of giants that keep shrinking their float year after year.
It’s not necessarily a bad thing, but it does mean the market behaves differently. It’s more sensitive to what the big players do, and it’s more prone to long stretches where valuations stay elevated because the supply of investable public equity keeps tightening.
In a way, the chart is showing you the quiet engine behind two decades of US outperformance: consolidation, buybacks, and the slow disappearance of smaller public companies. It’s a reminder that the strength on the surface isn’t just cyclical, it’s structural.
The number of US-listed companies is in a sharp decline:
The number of US-listed domestic companies has fallen below 4,000 this year, the lowest since 2020.
Since 2022, this count has dropped by -1,800, or -31%.
At this pace, the number of publicly listed companies could decline to the lowest on record as early as next year.
By comparison, about 6,500 firms were trading at the beginning of the century.
Meanwhile, cumulative corporate buybacks have reached a massive $12.7 trillion since 1998.
Big stocks will keep getting bigger. tweet
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EndGame Macro
The Truth About Reality We’re Not Ready to Admit
The Limits of Proof
These new papers claiming they’ve proven we’re not in a simulation sound confident, but once you actually read them, you see what they’re really ruling out. They argue the universe can’t be simulated because reality supposedly relies on non algorithmic understanding, something a computer could never reproduce. It’s an interesting argument, but it assumes any simulator would be bound by the same rules we’ve found from inside our own universe. That’s like a character in a video game insisting the developer can’t exist because the game physics don’t allow developers to exist. They’re only describing the box we’re in, not the world outside it.
And the Gödel angle they lean on, the idea that some truths can’t be fully captured by logic doesn’t really settle the question either. Maybe those incomplete edges are exactly what a simulation would disguise behind randomness. Maybe they’re artifacts of our own limits. It’s a clever mathematical argument, but it doesn’t close the door the way the headlines pretend it does.
The Moon, the Gaps, and the Feeling Something’s Off
Then you look at the stories we’ve told ourselves about our own history. We supposedly landed on the moon in 1969 with a computer weaker than the calculator on your phone… and then just stopped going. No bases. No tourism. No HD footage. No selfies with Earth hanging in the background. Whether you believe the moon landings happened exactly as written or not, the timeline still feels strange. Human beings don’t usually unlock a frontier and then ignore it for half a century. That gap, that mismatch between what we’re told and what feels plausible is the kind of thing that makes people wonder if the story we get is the full picture.
And that’s usually when the simulation question starts creeping in. Not because everything is fake, but because certain things don’t quite line up cleanly, and humans are wired to look for the bigger frame when the smaller one feels incomplete.
The Future That Makes the Theory Hard to Ignore
If you step back and look at our own technology curve, it becomes even harder to dismiss. Ten years ago, video games still looked like video games. AI was a gimmick. VR felt like a toy. Now we have photoreal graphics, AI that can hold convincing conversations, and immersive worlds that blur into real experience. If that’s what one decade looks like, imagine a hundred years. Imagine a thousand. It’s almost impossible to argue that advanced civilizations wouldn’t eventually reach a point where simulating something like us isn’t just possible, it’s trivial.
And that’s the whole tension…if simulation ever becomes possible, anywhere, at any point in the future, the odds we are the first generation become tiny. It’s far more likely that we’re somewhere down the chain rather than at the beginning of it. History is full of people who thought their moment was the center of everything. We’re probably not the exception.
What It Might Mean
Whether we’re in a simulation or not doesn’t automatically change the day to day. Pain would still be pain, love would still be love, choices would still matter. But it does mean the world might be built on rules or constraints we don’t fully understand. What we call laws of nature might just be the operating system. What we call mystery might be a boundary condition. And what scientists call non algorithmic understanding might just be a layer we’re not meant to access directly.
The truth is nobody actually knows what we’re living in. The physicists don’t know. The philosophers don’t know. The conspiracy theorists definitely don’t know. And the rest of us are just trying to make sense of a reality that feels deeper and stranger than the explanations we’re handed.
If anything, I’d say we understand far less about the nature of this place than we pretend.
🔥🚨BREAKING NEWS: UBC Okanagan Physicists just proved that the Universe isn’t a simulation a[...]
The Truth About Reality We’re Not Ready to Admit
The Limits of Proof
These new papers claiming they’ve proven we’re not in a simulation sound confident, but once you actually read them, you see what they’re really ruling out. They argue the universe can’t be simulated because reality supposedly relies on non algorithmic understanding, something a computer could never reproduce. It’s an interesting argument, but it assumes any simulator would be bound by the same rules we’ve found from inside our own universe. That’s like a character in a video game insisting the developer can’t exist because the game physics don’t allow developers to exist. They’re only describing the box we’re in, not the world outside it.
And the Gödel angle they lean on, the idea that some truths can’t be fully captured by logic doesn’t really settle the question either. Maybe those incomplete edges are exactly what a simulation would disguise behind randomness. Maybe they’re artifacts of our own limits. It’s a clever mathematical argument, but it doesn’t close the door the way the headlines pretend it does.
The Moon, the Gaps, and the Feeling Something’s Off
Then you look at the stories we’ve told ourselves about our own history. We supposedly landed on the moon in 1969 with a computer weaker than the calculator on your phone… and then just stopped going. No bases. No tourism. No HD footage. No selfies with Earth hanging in the background. Whether you believe the moon landings happened exactly as written or not, the timeline still feels strange. Human beings don’t usually unlock a frontier and then ignore it for half a century. That gap, that mismatch between what we’re told and what feels plausible is the kind of thing that makes people wonder if the story we get is the full picture.
And that’s usually when the simulation question starts creeping in. Not because everything is fake, but because certain things don’t quite line up cleanly, and humans are wired to look for the bigger frame when the smaller one feels incomplete.
The Future That Makes the Theory Hard to Ignore
If you step back and look at our own technology curve, it becomes even harder to dismiss. Ten years ago, video games still looked like video games. AI was a gimmick. VR felt like a toy. Now we have photoreal graphics, AI that can hold convincing conversations, and immersive worlds that blur into real experience. If that’s what one decade looks like, imagine a hundred years. Imagine a thousand. It’s almost impossible to argue that advanced civilizations wouldn’t eventually reach a point where simulating something like us isn’t just possible, it’s trivial.
And that’s the whole tension…if simulation ever becomes possible, anywhere, at any point in the future, the odds we are the first generation become tiny. It’s far more likely that we’re somewhere down the chain rather than at the beginning of it. History is full of people who thought their moment was the center of everything. We’re probably not the exception.
What It Might Mean
Whether we’re in a simulation or not doesn’t automatically change the day to day. Pain would still be pain, love would still be love, choices would still matter. But it does mean the world might be built on rules or constraints we don’t fully understand. What we call laws of nature might just be the operating system. What we call mystery might be a boundary condition. And what scientists call non algorithmic understanding might just be a layer we’re not meant to access directly.
The truth is nobody actually knows what we’re living in. The physicists don’t know. The philosophers don’t know. The conspiracy theorists definitely don’t know. And the rest of us are just trying to make sense of a reality that feels deeper and stranger than the explanations we’re handed.
If anything, I’d say we understand far less about the nature of this place than we pretend.
🔥🚨BREAKING NEWS: UBC Okanagan Physicists just proved that the Universe isn’t a simulation a[...]
Offshore
EndGame Macro The Truth About Reality We’re Not Ready to Admit The Limits of Proof These new papers claiming they’ve proven we’re not in a simulation sound confident, but once you actually read them, you see what they’re really ruling out. They argue the…
fter all and that we are all 100% real.
UBC Okanagan mathematically demonstrated that the universe cannot be simulated, using Gödel’s incompleteness theorem, scientists found that reality requires “non-algorithmic understanding,” something no computation can replicate.
This discovery disproves the simulation hypothesis and reveals that the universe’s foundations exist beyond any algorithmic system ‘and increases the likelihood of God being real.’ - Dom Lucre | Breaker of Narratives tweet
UBC Okanagan mathematically demonstrated that the universe cannot be simulated, using Gödel’s incompleteness theorem, scientists found that reality requires “non-algorithmic understanding,” something no computation can replicate.
This discovery disproves the simulation hypothesis and reveals that the universe’s foundations exist beyond any algorithmic system ‘and increases the likelihood of God being real.’ - Dom Lucre | Breaker of Narratives tweet
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EndGame Macro
China’s Housing Problem: The Crash They’re Stretching Over Years
China didn’t let the housing market crash outright, but they also haven’t been able to revive it. Year over year prices are still negative, and have been for more than two years. Month to month numbers are barely above zero. That’s the market lying flat on the floor, breathing shallowly.
What you’re really looking at is the long tail of the three red lines policy colliding with years of overbuilding, collapsing confidence, and a demographic slowdown that no stimulus package can easily reverse. When you cut off developers’ access to credit after a decade plus frenzy of debt fueled construction, you’re going to expose just how much of the demand was artificial. Evergrande and Country Garden were the headline blowups, but they weren’t the problem, they were the signal.
And now the sector is stuck in that awkward place where the government won’t let it die, but it also can’t bring it back to life.
Why It’s Playing Out This Way
China is choosing a slow bleed over a big bang. A full bailout might temporarily lift prices, but it would also reinflate the very bubble they’re trying to defuse, hammer the currency, and widen inequality at a time when social stability matters more than ever. So instead, Beijing is doing the minimum required to keep things from spiraling…easier mortgages, local governments buying leftover inventory, banks pushed to support unfinished projects.
But none of that creates new buyers. Households are tapped out, confidence is low, the population is shrinking, and the wealth effect that drove consumption for two decades has flipped into reverse. People don’t want a second apartment anymore, they want certainty and cash flow.
That’s why the chart looks the way it does. The worst of the decline is behind them, but the rebound that usually follows simply hasn’t showed up. And honestly, it probably won’t. The entire model to build, borrow, speculate, repeat has run its course.
China is not trying to revive the old housing boom. It’s trying to bury it slowly enough that the rest of the system can adjust. And that kind of transition doesn’t show up as a sharp recovery on a chart. It shows up exactly like this in a long, flat drag where prices don’t fall fast enough to force a reset, but don’t rise enough to restore confidence.
tweet
China’s Housing Problem: The Crash They’re Stretching Over Years
China didn’t let the housing market crash outright, but they also haven’t been able to revive it. Year over year prices are still negative, and have been for more than two years. Month to month numbers are barely above zero. That’s the market lying flat on the floor, breathing shallowly.
What you’re really looking at is the long tail of the three red lines policy colliding with years of overbuilding, collapsing confidence, and a demographic slowdown that no stimulus package can easily reverse. When you cut off developers’ access to credit after a decade plus frenzy of debt fueled construction, you’re going to expose just how much of the demand was artificial. Evergrande and Country Garden were the headline blowups, but they weren’t the problem, they were the signal.
And now the sector is stuck in that awkward place where the government won’t let it die, but it also can’t bring it back to life.
Why It’s Playing Out This Way
China is choosing a slow bleed over a big bang. A full bailout might temporarily lift prices, but it would also reinflate the very bubble they’re trying to defuse, hammer the currency, and widen inequality at a time when social stability matters more than ever. So instead, Beijing is doing the minimum required to keep things from spiraling…easier mortgages, local governments buying leftover inventory, banks pushed to support unfinished projects.
But none of that creates new buyers. Households are tapped out, confidence is low, the population is shrinking, and the wealth effect that drove consumption for two decades has flipped into reverse. People don’t want a second apartment anymore, they want certainty and cash flow.
That’s why the chart looks the way it does. The worst of the decline is behind them, but the rebound that usually follows simply hasn’t showed up. And honestly, it probably won’t. The entire model to build, borrow, speculate, repeat has run its course.
China is not trying to revive the old housing boom. It’s trying to bury it slowly enough that the rest of the system can adjust. And that kind of transition doesn’t show up as a sharp recovery on a chart. It shows up exactly like this in a long, flat drag where prices don’t fall fast enough to force a reset, but don’t rise enough to restore confidence.
China’s housing crash is accelerating:
New-home prices in China's 70 major cities fell -0.45% MoM in October, the steepest drop in a year.
At the same time, resale home prices fell -0.66% MoM, the largest decline in 13 months.
All 70 cities surveyed recorded declines in both new and resale home prices, confirming broad-based weakness across the entire market.
China’s property downturn has now lasted for over 4 years.
Meanwhile, a survey conducted by the China Index Academy across over 260 cities showed home-purchasing confidence in smaller cities dropped -2.9 percentage points MoM.
China's real estate crisis shows no signs of recovery. tweet
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EndGame Macro
The 401(k) Trick…Bigger Numbers, Weaker Dollars
The higher 401(k) limits look like a win. You can now save up to $24,500!…sounds empowering. But when you pair that with what’s happened to the dollar, the picture changes pretty quickly. Over the last decade plus, the currency has lost a huge chunk of its purchasing power. Between 2008 and 2025, prices rose roughly 50% in total meaning every dollar you save today buys materially less down the road. That’s why contribution limits keep rising: not because the system is generous, but because the dollar quietly buys less each year. The bars on the chart go up, but the value behind them doesn’t rise in the same way.
A $1 investment grows to $6.48 nominally, but inflation eats away about a third of that return, leaving just over $3 of real value and that’s before taxes. So when people get excited about higher limits, they’re usually thinking in nominal terms, not in terms of what those future dollars will actually afford.
Where Your Money Really Goes
Then there’s the structure of the 401(k) itself. Your contributions don’t just sit in an account; they flow into funds that charge ongoing fees. Sometimes it’s 0.3–0.5%, but it can be 1–2% depending on your plan. Those fees come out every single year, no matter how the market performs. They’re invisible, you never see a bill but they quietly siphon off a big chunk of your long term compounding.
In other words, your savings don’t just work for you. They also work for the fund companies, the plan providers, the brokers, and the managers who get paid whether your account grows in real terms or not. And the more you contribute, the bigger their slice becomes.
That’s why the whole setup feels a little backwards…the system constantly encourages you to put more in, but inflation weakens the value of those contributions, and fees skim the growth on the back end. By the time you retire, you’ve carried the inflation risk, the market risk, and the tax risk while everyone else involved took their cut along the way.
What This Really Means
This doesn’t mean a 401(k) is useless. If you have a strong employer match, low fees, and you’re disciplined, it can still be a meaningful part of your plan. But it’s not the slam dunk people make it out to be. Higher limits don’t automatically mean you’re building wealth; they just give you permission to save more dollars that are worth less.
Going forward, the trend isn’t hard to see: a weaker dollar over time, higher nominal contribution limits to keep up the illusion of progress, and a retirement system that quietly depends on workers funneling more and more of their earnings into fee generating products.
The real question isn’t how much you can contribute. It’s how much purchasing power you’ll actually get back when it’s finally time to use it.
tweet
The 401(k) Trick…Bigger Numbers, Weaker Dollars
The higher 401(k) limits look like a win. You can now save up to $24,500!…sounds empowering. But when you pair that with what’s happened to the dollar, the picture changes pretty quickly. Over the last decade plus, the currency has lost a huge chunk of its purchasing power. Between 2008 and 2025, prices rose roughly 50% in total meaning every dollar you save today buys materially less down the road. That’s why contribution limits keep rising: not because the system is generous, but because the dollar quietly buys less each year. The bars on the chart go up, but the value behind them doesn’t rise in the same way.
A $1 investment grows to $6.48 nominally, but inflation eats away about a third of that return, leaving just over $3 of real value and that’s before taxes. So when people get excited about higher limits, they’re usually thinking in nominal terms, not in terms of what those future dollars will actually afford.
Where Your Money Really Goes
Then there’s the structure of the 401(k) itself. Your contributions don’t just sit in an account; they flow into funds that charge ongoing fees. Sometimes it’s 0.3–0.5%, but it can be 1–2% depending on your plan. Those fees come out every single year, no matter how the market performs. They’re invisible, you never see a bill but they quietly siphon off a big chunk of your long term compounding.
In other words, your savings don’t just work for you. They also work for the fund companies, the plan providers, the brokers, and the managers who get paid whether your account grows in real terms or not. And the more you contribute, the bigger their slice becomes.
That’s why the whole setup feels a little backwards…the system constantly encourages you to put more in, but inflation weakens the value of those contributions, and fees skim the growth on the back end. By the time you retire, you’ve carried the inflation risk, the market risk, and the tax risk while everyone else involved took their cut along the way.
What This Really Means
This doesn’t mean a 401(k) is useless. If you have a strong employer match, low fees, and you’re disciplined, it can still be a meaningful part of your plan. But it’s not the slam dunk people make it out to be. Higher limits don’t automatically mean you’re building wealth; they just give you permission to save more dollars that are worth less.
Going forward, the trend isn’t hard to see: a weaker dollar over time, higher nominal contribution limits to keep up the illusion of progress, and a retirement system that quietly depends on workers funneling more and more of their earnings into fee generating products.
The real question isn’t how much you can contribute. It’s how much purchasing power you’ll actually get back when it’s finally time to use it.
"Americans can contribute up to $24,500 to their 401(k) in 2026—up 4% from this year’s $23,500 and 44% higher than a decade ago."
@LarryAdamRJ https://t.co/cEGJ5c8Nlt tweet
Offshore
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Fiscal.ai
U.S. v. Rest of the World - Cigarette Consumption
Altria (U.S.) has seen a 36% decline in the sales of cigarettes over the last 5 years.
Philip Morris (Rest of the World) is basically flat.
$MO $PM https://t.co/IQ6hwouHwh
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U.S. v. Rest of the World - Cigarette Consumption
Altria (U.S.) has seen a 36% decline in the sales of cigarettes over the last 5 years.
Philip Morris (Rest of the World) is basically flat.
$MO $PM https://t.co/IQ6hwouHwh
tweet
Offshore
Photo
EndGame Macro
When Reserves Lie: The Chart Everyone Misreads
Before 2008, we had a classic scarce reserve system. Banks ran on a small pool of reserves to clear payments and meet requirements. The Fed nudged that pool up or down to steer the overnight rate. Banks didn’t need reserves to make a loan, they created deposits when they lent but once those deposits moved through the system, they needed reserves to settle with other banks and stay solvent.
The real action, though, was always in credit risk and the yield curve. The 2 year, 10 year, mortgage rates reflected the market’s view on future growth, inflation, and Treasury supply, not the level of reserves. M2 could climb for decades because banks were willing to lend and balance sheets weren’t suffocated by post crisis regulation. Reserves were the small amount of real money keeping the plumbing clearing in the background, not the driver of broad money.
The Post GFC regime shift
After 2008, the architecture flipped. QE and the floor system turned reserves into a ring fenced asset for a narrow club of big banks. Trillions now sit on G-SIB balance sheets, earning interest at the Fed, helping them meet LCR/SLR/HQLA requirements, and cycling through the RRP/TGA machinery. They’re not there to be multiplied into new loans like the textbook money multiplier suggests.
Meanwhile, more credit intermediation migrated to non banks and global shadow systems that don’t have reserve access at all. You can 75x reserves and only see M2 roughly 3x if the real constraints are balance sheet capacity, capital rules, and risk appetite not “is another dollar of base money available?”
Collateral, the curve, and who really sets rates
In this world, Treasuries do more of the money work than reserves. They can be pledged, rehypothecated, and used by almost every balance sheet. Reserves can’t. The real scarcity isn’t a Fed liability, it’s clean collateral and the ability to warehouse it.
The Fed truly controls one thing: the overnight rate. Everything beyond that like the 2 year, the 10 year, mortgages…trades on expectations for future short rates, inflation, and heavy issuance. QE lets the Fed lean on term premia by taking duration out of the market, but it doesn’t give them lasting control of the long end. The market still gets a vote, and when deficits explode or inflation surprises, the curve can move sharply against the Fed.
QE is just an asset swap is right on narrow accounting…swapping a bond for a reserve doesn’t create new net claims. But once you add fiscal into the picture, the Treasury is issuing new net assets, and QE is changing who holds that duration and at what yield. That matters for how the curve is priced and how financial conditions evolve.
Why it feels like liquidity everywhere and nowhere
Put it together and you get a strange picture where FRED shows trillions in reserves, yet we still see repo spikes, SOFR scares, and collateral shortages. Funding can feel tight even when base money looks huge because the plumbing is misaligned. Reserves are concentrated at a few big banks, encumbered by capital rules and politics. Non banks do much of the lending and liquidity transformation but must work through bills, repo, and derivatives instead of tapping the Fed.
The system oscillates between too much and too little at the same time. You can have a glut of reserves sitting inert while dealers and non banks scramble for balance sheet room and collateral. The Fed can cut overnight rates, but if the market doesn’t buy the growth or inflation story or if issuance overwhelms dealers..the long end can tighten conditions right back up.
So just add more reserves misses the point. The real question is how reserves and Treasuries move through the system, under which constraints, and how that shapes the curve the market sets. Change those channels…capital treatment of sovereign debt, non bank access, floor system design and the whole machine behaves differently without adding a single new dollar.<code[...]
When Reserves Lie: The Chart Everyone Misreads
Before 2008, we had a classic scarce reserve system. Banks ran on a small pool of reserves to clear payments and meet requirements. The Fed nudged that pool up or down to steer the overnight rate. Banks didn’t need reserves to make a loan, they created deposits when they lent but once those deposits moved through the system, they needed reserves to settle with other banks and stay solvent.
The real action, though, was always in credit risk and the yield curve. The 2 year, 10 year, mortgage rates reflected the market’s view on future growth, inflation, and Treasury supply, not the level of reserves. M2 could climb for decades because banks were willing to lend and balance sheets weren’t suffocated by post crisis regulation. Reserves were the small amount of real money keeping the plumbing clearing in the background, not the driver of broad money.
The Post GFC regime shift
After 2008, the architecture flipped. QE and the floor system turned reserves into a ring fenced asset for a narrow club of big banks. Trillions now sit on G-SIB balance sheets, earning interest at the Fed, helping them meet LCR/SLR/HQLA requirements, and cycling through the RRP/TGA machinery. They’re not there to be multiplied into new loans like the textbook money multiplier suggests.
Meanwhile, more credit intermediation migrated to non banks and global shadow systems that don’t have reserve access at all. You can 75x reserves and only see M2 roughly 3x if the real constraints are balance sheet capacity, capital rules, and risk appetite not “is another dollar of base money available?”
Collateral, the curve, and who really sets rates
In this world, Treasuries do more of the money work than reserves. They can be pledged, rehypothecated, and used by almost every balance sheet. Reserves can’t. The real scarcity isn’t a Fed liability, it’s clean collateral and the ability to warehouse it.
The Fed truly controls one thing: the overnight rate. Everything beyond that like the 2 year, the 10 year, mortgages…trades on expectations for future short rates, inflation, and heavy issuance. QE lets the Fed lean on term premia by taking duration out of the market, but it doesn’t give them lasting control of the long end. The market still gets a vote, and when deficits explode or inflation surprises, the curve can move sharply against the Fed.
QE is just an asset swap is right on narrow accounting…swapping a bond for a reserve doesn’t create new net claims. But once you add fiscal into the picture, the Treasury is issuing new net assets, and QE is changing who holds that duration and at what yield. That matters for how the curve is priced and how financial conditions evolve.
Why it feels like liquidity everywhere and nowhere
Put it together and you get a strange picture where FRED shows trillions in reserves, yet we still see repo spikes, SOFR scares, and collateral shortages. Funding can feel tight even when base money looks huge because the plumbing is misaligned. Reserves are concentrated at a few big banks, encumbered by capital rules and politics. Non banks do much of the lending and liquidity transformation but must work through bills, repo, and derivatives instead of tapping the Fed.
The system oscillates between too much and too little at the same time. You can have a glut of reserves sitting inert while dealers and non banks scramble for balance sheet room and collateral. The Fed can cut overnight rates, but if the market doesn’t buy the growth or inflation story or if issuance overwhelms dealers..the long end can tighten conditions right back up.
So just add more reserves misses the point. The real question is how reserves and Treasuries move through the system, under which constraints, and how that shapes the curve the market sets. Change those channels…capital treatment of sovereign debt, non bank access, floor system design and the whole machine behaves differently without adding a single new dollar.<code[...]