SpaceX is planning a monster initial public offering (IPO). Elon Musk is reportedly seeking to raise some $75 billion, at a valuation of $1.75 trillion, next month. It will be both his birthday and a moment when Venus and Jupiter will be in alignment. It would be the biggest IPO in history by far, utterly dwarfing Saudi Aramco’s $29 billion figure back in 2019.

Musk might sell those shares, too. One reason why, despite the ludicrous valuation, is that stock indices are changing their rules to allow SpaceX to join almost right away and with fewer conditions, thus forcing investors who follow a passive strategy, like index funds and many pension funds, to buy the company’s shares.

The NASDAQ stock exchange used to require a company to have at least 10 percent of its stock publicly traded, and see it traded for at least three months, before being able to join. Those rules are now gone; SpaceX will be eligible after just 15 trading days and with less than 5 percent of its stock available to the public. The S&P 500 reform now under discussion is removing the requirement that companies be profitable (as SpaceX is not, as will be seen below)—but only for the largest 100 companies.

“Historically, the function of IPOs has been to allow insiders to cash out,” said economist J.W. Mason, co-author of the recent book Against Money (for which, full disclosure, I provided a blurb). Thanks to these rule changes, a large fraction of the bag holders will be passive investors—which is to say, basically everyone saving for retirement. “It will be impossible to not own them … This will be really helpful for demand,” one adviser to the deal told the Financial Times.