I believe this is the cycle signal that euphoria has set in 🤡🤪









CAGR’s true power emerges over time because of compounding. While a 12% or even 61% annual growth rate might not seem life-changing in a single year, the table shows how it can transform a small investment into a fortune over a decade or more.
The key to CAGR’s power lies in compounding. Gold was exciting the last 12 months but you will see over last 14 years was FAR LESS than even the S&P500! Let’s look at the table to see this in action:
Example 1: Bitcoin
1-year CAGR: 61%
$100 grows to $161
5-year CAGR: 62%$100 grows to $1,115.77
13-year CAGR: 115%
$100 grows to $2,997,490.39
Even though the CAGR for Bitcoin fluctuates (e.g., 61% in year 1, 62% in year 5, 115% in year 13), the long-term effect is staggering. After 13 years, $100 turns into nearly $3 million because each year’s growth builds on the previous years’ gains. This is why even a high but consistent growth rate can lead to exponential results over time.
Example 2: Gold
1-year CAGR: 44%
$100 grows to $144
5-year CAGR: 14%
$100 grows to $192.54
13-year CAGR: 6%
$100 grows to $213.29
Gold’s CAGR is much lower than Bitcoin’s, and its growth is more modest. However, even a 6% CAGR over 13 years still more than doubles the initial $100, showing how compounding works even with smaller growth rates over long periods.
Example 3: S&P 500
1-year CAGR: 12%
$100 grows to $112
5-year CAGR: 14%$100 grows to $192.54
13-year CAGR: 12%
$100 grows to $436.35
The S&P 500 has a relatively stable CAGR (around 11-14%). While it doesn’t match Bitcoin’s explosive growth, it still turns $100 into $436.35 over 13 years—a more than 4x increase—demonstrating steady, reliable compounding.
The U.S. middle class is shrinking, but largely because people are climbing into higher income brackets. Mark Perry, referencing census data, notes that the share of middle-income households has declined as more have become high-income households. Even better: many low-income households are advancing to the middle class. Bitcoin and hard assets and retail investors can help themselves escape the matrix. A quote from Saylor that encapsulates this perspective is: "It’s very rare that you find a technology that solves every rich person's problem and every poor person's problem simultaneously."