Glossary

Inflation distorts every return: a 100% gain over a period when prices also doubled is, in the end, no gain in purchasing power at all. That is why almost no financial figure reads on its own — it needs a ruler. The terms below are that ruler. They recur across Had Invested because they separate what looks true from what is: a nominal figure from a real one, a raw price from a total return, an exchange-rate move from a yield, the multiple on a chart from the drawdown you had to sit through to reach it. Each definition exists so you can read any answer here without being fooled by a big number that, once the context is stripped out, is worth less than it appears.

CPI-U

The broadest official U.S. consumer price index, published monthly by the BLS since 1913.

Inflation adjustment

Restating a past amount in today's dollars using the ratio of CPI levels.

Nominal vs real

Nominal is the figure of its time; real is adjusted for inflation.

Purchasing power

What money actually buys — the thing inflation erodes.

Price index vs total return

A price index (the S&P 500 here) excludes dividends; total return reinvests them and is higher.

Exchange rate

The price of one currency in another. Cash held in a currency earns no interest, so a rate move is not a return.

Drawdown

The largest fall from a peak to the following trough — the psychological price of any multiple.

CAGR

Compound annual growth rate: (final/initial)^(1/years) − 1.

Descriptive, educational content computed from official public data. Not investment advice. Past performance does not guarantee future results.