The Illusion of Wealth & How to Beat Inflation: A 100-Year Perspective
We tested 30 ideas about how to beat inflation against 100 years of US money supply data, from gold and housing to savings, the S&P 500 and Bitcoin.
Topic
Investing Research: The Illusion of Wealth Series
All of our research so far belongs to one project, The Illusion of Wealth, published in June 2026 as an overview and six parts.
Read more
The idea behind it was to measure every major asset against the growth of the US money supply instead of CPI, and across 30 hypotheses and 100 years of data that one change rearranged most of what we expected to find.
The parts run in order. Part I covers gold, silver and housing, Part II stocks and savings, Part III a nine-asset scorecard, Part IV Berkshire Hathaway and the IPO winners, Part V crypto and tech, and Part VI our base-case models for 2030 and 2035. Each one lists its sources, mostly FRED, NYU Stern, Macrotrends and Yahoo Finance, so the numbers can be checked.
- 30 Hypotheses tested Across 100 years of US market and money supply data.
- 7 Research articles An overview plus Parts I to VI, published in June 2026.
- 6.56% Average yearly M2 growth The hurdle rate an investment had to beat to keep its share of the money pool.
Articles on Research
7 articles from our research on this topic.
Nvidia Stock Prediction & Gold Price Forecast 2030: The Modern Playbook
Our base-case Nvidia stock prediction and gold price forecast for 2030 and 2035, alongside Bitcoin and the Nasdaq, all modelled against money supply growth.
Crypto vs Stocks: Bitcoin & Tech in the Digital Era
We measure Bitcoin, Nvidia, Apple and the Nasdaq against money supply growth to settle crypto vs stocks, and to see how much faster tech built real wealth.
Warren Buffett Returns, Berkshire Hathaway Performance & IPO Winners
Warren Buffett's returns at Berkshire Hathaway came to 1,027x after money printing over 60 years. We compare them with Walmart, Nike and other IPO winners.
Historical Asset Class Returns: The 100-Year Scorecard
Historical asset class returns since 1928 for nine investments, from small caps to T-bills, and why only three of them grew faster than the money supply.
Stocks vs Inflation: Does the Stock Market Beat Inflation? Avoid the Savings Trap
We test whether the stock market beats inflation once money printing counts, using the S&P 500's 468x rise since 1926 and savings that fell to 4.3 cents.
Gold vs Real Estate Returns & Which Asset Beat Inflation? The 100-Year Performance
Gold rose 168x and US house prices 83x after 1926, while the money supply grew 503x. We compare gold vs real estate returns to see which kept its value.
Plain-English definitions
Key terms for research
- M2 money supply
- The Federal Reserve’s measure of cash, current accounts and easily accessible savings in the US. We use it to see how quickly new money is being created.
- M2-adjusted value 1.0 = break-even
- An asset’s growth divided by M2 growth over the same years. Above 1.0 it gained share of the money pool, below 1.0 it lost share.
- The 6.56% rule 6.56% a year
- The average annual growth of US M2 over the last century. Assets compounding faster gained ground, slower ones lost it. More about The 6.56% rule
- Normalised to 1.0
- Setting every asset to the same starting value so growth can be compared on one chart regardless of the original price.
FAQ
Questions about research
Answers drawn from the figures in our research. Educational only, not financial advice.
What did the research find overall?
That very few assets beat money printing on price alone, and that the ones which did win almost always reinvested their income for decades. Gold, housing and savings all lost ground to M2 over the century. The S&P 500 only came out ahead with dividends reinvested, Berkshire Hathaway compounded at 19.8% a year for 60 years, and in the digital age Nvidia and Bitcoin reached similar or bigger gains in a fraction of the time. The overview pulls those threads together around what we call the 6.56% rule.
Where does the data come from?
Money supply figures come from the Federal Reserve Bank of St. Louis (FRED), long-run asset returns mainly from Aswath Damodaran’s dataset at NYU Stern, and price histories from Macrotrends, Yahoo Finance and, for UK houses, Nationwide. Each article lists its own references at the end, and where the start dates differ between parts, for example 1926 in Part I and 1928 in Part III, the M2 multiple changes with them.
Sources