> just because yesterday's rules were "invest in S&P500" does not mean the governors of many (not all) funds cannot change the rules to dodge such blatant fraud

There are no governors. The assets that automatically follow the S&P 500 are like individual IRAs. If a fund has a governing body, they're generally not indexing to a single narrow index like the S&P 500. They're going for a set of total-market funds, or they're building a custom benchmark.

For the assets that do follow the S&P 500, virtually nbody would be expected to react to these kinds of rule changes. If anything, you'd just create a higher-fee fund that anyone who is upset about this can switch into that equal weights or won't include SpaceX. This is what some RIAs I know in the Bay Area have done, and this entire shitshow has just been a moneymaker for them.

> managers of huge funds are not complete idiots

Zero hedge funds automatically follow the S&P 500, or any other public index, like that. That's sort of the point of being a hedge fund–you're delivering something different.