To The Moon

$NVIDIA(NVDA)$

It’s a fair and important question — one that many of my subscribers and viewers continue to ask. For most of modern history, the stock market has been viewed as a reflection of economic vitality — a mirror showing the strength and resilience of a nation’s economy. But today, that mirror is cracked. What we see in global financial markets, particularly in the United States, is not an image of true economic health, but rather a distortion created by decades of monetary excess, financial engineering, and manipulated market forces.

The numbers alone tell the story.

Take Nvidia as an example. In August of this year, a single U.S. semiconductor company reached a market capitalization of roughly $4.4 trillion. That’s more than the entire GDP of Japan, greater than the size of India’s economy, and higher than the total market value of every company listed on the Swiss stock exchange combined. On paper, Nvidia is now worth more than all the farmland in the United States — and nearly one-fifteenth the value of all the gold ever mined in human history.

Yet Nvidia does not grow food, pave roads, or produce energy. It makes chips — powerful and essential, yes, but hardly something that justifies a valuation rivaling that of entire nations. This is the new absurdity of modern finance: stock valuations soaring far beyond any reasonable connection to real-world economic activity.

And Nvidia isn’t alone. The so-called “Magnificent Seven” — Apple, Microsoft, Amazon, Alphabet, Meta, Tesla, and Nvidia — now boast a combined market capitalization of over $19 trillion. That’s more than the combined GDPs of Germany, Japan, and India. These numbers have become so inflated they’ve lost all meaning.

The stock market no longer mirrors economic reality. It mirrors the distortion of cheap money, speculative mania, and government policies that have turned global finance into an alternate universe.

How Did We Get Here?

The roots of this distortion trace back decades — arguably to the collapse of the Bretton Woods system in the early 1970s, when global currencies were untethered from gold. But the real turning point came after the 2008 financial crisis. To rescue collapsing economies, central banks unleashed extraordinary measures: quantitative easing, near-zero interest rates, and unprecedented government debt issuance.

These policies were meant to be temporary. Instead, they became the foundation of the post-crisis financial order. Central banks flooded the system with liquidity — trillions of dollars conjured into existence with a few keystrokes — and handed that money to banks, corporations, and governments.

Predictably, the new money did not flow evenly. It went first to those closest to the source: financial institutions, hedge funds, and large corporations. Economists call this the Cantillon Effect — when new money enters the economy, those who receive it first benefit the most, because they can spend it before prices rise. By the time it reaches ordinary consumers and workers, inflation has already eroded purchasing power.

In other words, the wealthy accumulate assets that rise in value — stocks, bonds, and real estate — while everyone else faces higher prices for essentials like food, housing, and energy. This has created two-tiered inflation: consumer inflation that erodes daily life, and asset inflation that enriches the elite.

The result is an economy where the rich grow richer through rising asset prices, while the middle class and poor are priced out of housing, burdened by debt, and unable to save.

The Illusion of Prosperity

Artificially low interest rates have only deepened the divide. For more than a decade, money has been virtually free to borrow. In parts of Europe, rates even turned negative — meaning banks were effectively paying companies to take loans.

The result? A wave of financial engineering. Instead of investing in innovation or productivity, many corporations borrowed cheap money to buy back their own shares, reducing the number of shares in circulation and artificially boosting stock prices. That’s how bubbles form — by design, not accident.

This didn’t make companies stronger. It only made them look richer on paper. It created the illusion of growth — a mirage built on debt and speculation. Meanwhile, central banks congratulated themselves for “stabilizing markets,” not realizing they were inflating the largest asset bubble in modern history.

To be fair, some companies — like Apple — truly generate staggering profits. Apple’s $391 billion in 2024 revenue is greater than the GDP of most countries. But such examples have become the exception used to justify the absurdity of the rule. For every Apple, there are dozens of companies trading at 50 to 100 times earnings, not because of real innovation, but because of speculation.

This is the heart of the problem: the growing disconnect between price and value.

When Markets Become Casinos

Markets were once places of price discovery, where investors evaluated companies based on future earnings, competition, and risk. Now, they’ve become casinos — where central banks set the odds and everyone plays because there’s no alternative.

Even professional investors acknowledge the absurdity. In a recent Bank of America survey, 91% of fund managers, representing nearly half a trillion dollars in assets, said U.S. equities are overvalued. Everyone knows it. Yet most remain fully invested. Why? Because they have no choice.

In a world where cash yields next to nothing, and central banks have turned speculation into the only viable game, even the professionals are trapped inside the very bubble they helped inflate.

The Social Cost of Asset Inflation

This distortion isn’t just economic — it’s social and political. The divide between those who own assets and those who don’t has become one of the defining features of modern life. Homeownership is increasingly out of reach. Retirement savings fail to keep up with inflated markets. Young people, burdened by debt and high living costs, view wealth as unattainable.

This growing inequality is more than a financial issue; it’s a political time bomb. As wealth concentrates in fewer hands, trust in institutions erodes. The middle class — the cornerstone of democratic stability — feels squeezed out of the future, while the elite grow ever more detached from ordinary reality.

We now live in a world where paper wealth grows faster than real wealth, where stock indices hit record highs even as families struggle to pay rent, and where numbers on screens rise while wages stagnate.

The system has become self-reinforcing — and dangerously fragile. One major shock, whether a rate hike, debt crisis, or geopolitical conflict, could trigger a cascade that wipes out trillions in paper wealth, revealing just how hollow the foundation truly is.

The Real Danger Ahead

Yet the greatest danger may not be the crash itself — but what follows. What happens if people lose faith not just in markets, but in money itself? What if they no longer believe the financial system serves any purpose beyond enriching the few? The legitimacy of the entire system could unravel — quickly.

The story of asset inflation isn’t just about economics; it’s about what happens when money loses meaning. When value no longer comes from production, but from manipulation. When finance forgets its purpose — to allocate capital efficiently, reward innovation, and advance human progress.

Unless the system is recalibrated, and finance once again anchored to real economic value, the next collapse won’t just be another market correction. It will be a reckoning — a reminder that no matter how high markets climb, the laws of economics and human society always pull them back to earth.