Outside of the top stocks, S&P 500 forward profits haven't grown in 3 years

Think about the classic economics fairy tale of why income redistribution is bad ("inefficient") and trickle-down economics is good.

Billionaire Bill buys his 10th yacht. Workers need to manufacture the yacht and all the different parts of it. He needs to hire staff to keep it clean, to maintain it, to operate it, and to stock the fridge; he needs to pay for satellite internet so he can do business on the yacht; and he needs to buy TVs for the kids. All of that stuff is produced by other businesses with their own employess and sometimes independent contractors. So all of this economic economic activity results in a flow of income to a large number of individuals. Those individuals then themselves all need to buy groceries, clothes, housing, transportation, etc. so all that income then continues to flow outward throughout the economy. The price system orchestrates everything so that the proceeds from Billionaire Bill's yacht are used to provide the goods and services of greatest value to everyone else.

That story of course is nonsense, but the question is: why? It seems correct. In fact it is broadly correct in the sense that the things described in the story do in fact happen in real life. So why isn't it a happy ending like in the fairy tale?

There are a few things going on here, but the one of importance here is where are those yacht-builder employees buying their goods and services from?

One missing aspect of the story is that they're paid a tiny amount compared to the top management of the yacht company and a few other specialists like the naval engineer, the captain, and the lead software developer. So they don't actually have a lot to spend. And what they do spend money on is largely provided by conglomerates controlled largely by Millionaire Mike and Trillionaire Todd, who of course are very close friends of Bill. Mike and Todd know ensure that their prices are as high as possible to capture as much of their customers' income as revenue. Mike and Todd then go buy golfing trips, yachts, mansions, etc. And the cycle continues.

The effect is that all the individual employees do in fact get some of Bill's billions of dollars in the form of income, but they only get enough to cover their essentials, and any profit from buying those essentials goes right back into the hands of another person just like Billionaire Bill. The income does in fact flow throughout the economy as in the bedtime story, but you can't understand the welfare of individuals within the economy by just looking at total flows.

You don't need to be a Marxist to see that this is how the economy works and has worked since the dawn of capitalism. It's a natural low-energy state that economies naturally tend towards, because humans are humans and there is always a minority that is willing and able to take avantage of others.

The only difference here is that the loop is tighter, where Bill Todd and Mike are all just buying each other's services directly.

The US has a lot of movers, not enough makers. Our GDP is essentially propped up by fake jobs that do nothing. Of course we are a service economy, but a lot of this isn't even services, it's just move thing A to thing B then move it back and make money doing that. It would make sense if we're physically moving stuff - but we're not. We're just moving money back and forth.

Though maybe I'm just unsophisticated. And it feels a little hopeless because there's no telling how long the smoke and mirrors will continue working, and whenever it stops, undoubtedly the rest of the economy is going to suffer, too. Bleh.

$RSP is $SPY, but equal allocation across all 500 companies. So the top tech stocks are ~1.5% of your holding instead of ~20%.

Reels isn't powered by Transformers per se (likely more of a complex mix of ML techniques), but it is powered by honest-to-goodness SOTA AI/ML running on leading-edge Nvidia GPUs.

I think, because they're so impressive, people assume Transformers = AI/ML, when there's plenty of other hyperscale AI/ML products on the market today.

Total Index is practically identical to S&P500 because Total Index is also market cap weighted.

Fair point about dumping entire positions not being ideal. I got lucky with the timing since the market dropped shortly after I sold. Definitely got lucky on timing that

Long term, I'll likely reinvest in the S&P 500, but as a much smaller slice of my portfolio alongside other indices, bonds, individual stocks, etc. The plan is to avoid that level of concentration going forward regardless of how well it might perform

I've been slowly DCAing out into bonds, but I'm still over 80% stock total.

The average person would be unlikely to be able to stomach holding a contract as each one moves the same as holding ~$250,000 of the S&P500. You get this by putting ~$25k down. A 10% move down and you are wiped, a 10% move up and you double your money.

However they do offer micro contracts which are $25,000 of S&P500 for ~$2,500.

This is a terrible idea. You should pay for value, not reward hard work. Rewards are for kids.