In this video Mark Moss argues that the bond portion of a traditional 60/40 portfolio is a guaranteed money‑loser in the current macro‑environment. He explains that the U.S. government runs roughly $2 trillion in annual deficits, financing the gap by issuing bonds that are bought by central banks, private banks and the government itself. As the supply of debt outstrips demand, central banks intervene (e.g., yield‑curve control), creating a "debt doom loop" where the government must print money to buy back its own debt – a process Moss calls fiscal dominance. This drives rapid growth in the M2 money supply, which he shows has been accelerating to about a 10 % annual increase over the past six years. Because the money supply is expanding faster than most asset returns, any investment earning less than ~10 % per year loses purchasing power. Traditional cash, a 60/40 portfolio (≈6.5 % return), or typical fixed‑income funds (4‑6 % yield) therefore erode wealth. Moss cites IMF and BIS papers on "Liquidation of Government Debt" to argue that governments will ultimately retire debt by allowing inflation to outpace bond yields, guaranteeing bondholders a loss. To preserve wealth, he proposes replacing the bond slice with assets that can outpace money‑supply growth – specifically Bitcoin and the NASDAQ – and doing so via a "vertical" investment structure that concentrates capital at the top of a portfolio rather than averaging across slices. He introduces his "Wealth Operating System," a three‑engine framework designed to consistently achieve the required hurdle rate, and invites viewers to a free strategy session for personalized analysis.
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Last year I was sitting across from a guy with about $2.1 million in a 60/40 portfolio, and I told him a quarter of it was already gone. Now, he didn't believe me. He didn't understand. So he pulled up a statement to look and he said, no, it's still there. But I said, yeah, but let's look at what those dollars would actually buy you 3 years ago. Groceries, insurance, property taxes, etc. And he could see that while his balance went up, his life was getting more expensive. Now, that's not because there was a market crash. Assets kept going up. So it's not that simple. So when you save and invest in index funds, it seems like the safest road to retirement. And that's why people keep repeating this. But that's exactly where you go wrong. There's one slice of a portfolio like his that just bleeds. Every time the Fed monetizes debt, it loses. There's one slice that most people double down on because it feels safe. And by the end of this video, you're going to know exactly which slice it is, how to replace it. So let's go. So the United States government is running roughly about $2 trillion deficits per year, meaning they're spending about $2 trillion more than they bring in, which means they have to get that money by borrowing it, by debt. And so they do that by issuing bonds. Every time they issue a bond, every time somebody buys a bond, that's how they monetize the debt. And so there's people buying it. We have governments around the world, central banks around the world, private banks in the United States, and they, uh, they all buy this government debt. And as long as they keep buying it, then the governments can keep printing and selling those bonds. Now, at some point, central banks may have more supply than demand, meaning that they have more debt they want to issue than there are buyers for it. When that happens, they turn to the banks. The banks have to start picking up the slack, and at some point, the central bank might even have to do that. If rates start going up too high, they can buy it down. We've seen this happen in Japan for decades. The United States have even done this as well, and this is called yield curve control. So if the yields are going too high, meaning the market is demanding too high of yields to buy that debt, they'll just issue their own money and they'll buy it down, and they can bring that yield down. Now, once this starts happening, it becomes a dangerous area of the market, and we call this fiscal dominance. And what that means is now the fiscal side, which is the government spending, and the monetary side, the Fed, become dominant, and they start losing control over the economy by just using rates alone. So as the governments have to start buying their own debt, that means they're increasing the debt to buy the debt, which creates what we call a debt doom loop. This means that the debt just continues to grow faster and faster and faster like a flywheel, and we see the money supply expand faster and faster and faster. So let me show you exactly what I'm talking about. This is a chart from the Fed. This is the Federal Reserve System chart of the M2 money supply. And what we can see going back here to 1960, we can see the rate of growth was here, but then they had to speed up the rate of growth. And so it went up and then the rate of growth went up and then the rate of growth went up and then the rate of growth went up. And as you can see, we're almost going straight parabolic. So when you're thinking about the price of assets going up, when you're thinking about your purchasing power of your dollar going down, it's because of this chart. And as you can see, it's happening faster and faster and faster. So while the government wants to tell you CPI, consumer price inflation, and they show you a basket of goods and what the prices have done, the real number that you're trying to outrun is this right here. You're trying to outrun how fast the money supply is growing. And as you can see, it becomes faster and faster and faster. Now, if you want to look at it, let's say over the last 6 years, it's about a 10% increase in the money supply per year, which means the number you need to beat to get ahead of this is about 10% a year. The number you need to achieve, 10% a year, is just to keep your head above water. And anything below that, you're actually losing ground. So if I'm holding cash in the bank, well, that money is losing about 10% of its purchasing power per year. If I put it into, let's say, your traditional 60/40 portfolio that's making, let's say, 6.5%, well, I'm losing 3.5% per year. If I put it into anything under 10%, you get the point. And this is the number you need to be watching. Hey, quick thing before I keep going. What I just walked through is something most people never actually run the numbers on for their own situation, and it costs them for years without even realizing it. Now, my team runs a free strategy session where we look at your actual numbers and we tell you where you really stand. Now, this isn't for everyone, but if you've got some money and it's on the line and you want a real answer instead of just a guess, you want the data, then go down below right now, book a call with my team, and and then come back and finish this. Now, the key is with the bonds is that the bonds is the debt. But for the government, they are taking on all this debt and they have to pay it back. And so the key for them is something that's called the liquidation of government debt. Now, there's a white paper that was put out by the IMF. The BIS also put one out called Liquidation of Government Debt. And it basically explains how the government will bring this debt level down by liquidating the debt. And specifically what they need to do is to let inflation run hotter than the yields they pay out on the bonds. What this means is that if you're a bondholder, you're pretty much guaranteed to lose money because that debt has to be liquidated through inflation. So that means that you're guaranteed to lose money holding those things, which is why the 60/40 portfolio has been a huge loser over the last, uh, 6 years or so and will continue to as long as we stay in this era of debt. Okay. So going back to the slice of this guy's portfolio that was actively losing money. Now, when you think about your portfolio, most people think about it like a pie. And they'll divvy it up a little bit like this. And so, you know, $1 comes into the portfolio and gets fractionalized. And so that's why I'm calling it like a slice, like a slice of a pie. And so the portion here that's tied to bonds, as I just said, that's losing money. It's guaranteed to lose money because the government has to liquidate away their debt. It's why they want the inflation. So you're guaranteed to lose money holding bonds. Now, look, it wasn't always this case. For the previous 40 years, bonds were a great investment, but it's no longer the case anymore because of the debt situation that we're in. Also, we have things probably like fixed income funds. Most fixed income might pay you, you know, 4%, 6%, something like that. And again, that's losing money as well. Where we need to do is we need to take these pieces and we need to redirect them into other assets that can pay a positive yield. So what is that? Well, We only really have two. We have Bitcoin and we have the NASDAQ. Both of those have been able to outperform the money supply increase. However, what we can do is think it's not about the asset. It's rather about the structure in which we use those assets. Instead of fractionalizing my assets like this, which only gives me the average of those things, what we want to do is we want to invest vertically. So then we can I have $1 at the top controlling multiple assets at the same time. So instead of averaging this down here, I get the multiplied return. All right. So now, you know, the real number, what we call the hurdle rate, the real number you have to hurdle over, the number you have to beat in order to actually grow your wealth, or at least keep it, at least hold onto it in this era of liquidation of government debt. But once you have your number, then the next question becomes, how do I consistently achieve that number? How do I achieve it? Or how do I beat that number over the long run? Now I do this with 3 different engines that are all part of what I call the Wealth Operating System. You want to understand how all 3 engines work together? You might want to go watch this video right here and I'll see you over there.
