DOW Crosses 30,000 !
Wow ! Wouldn’t that be a nice Headline !
I’m not usually one to predict where the DOW will be because for me I know that as a Dividend Income Investor its more about the journey than the destination. But as I see how the world economics are playing out I can see this happening very soon. In fact I am going out on a limb and predict that the we will see DOW 30,000 by 31 December 2018. That would represent a 30% gain from where we are today.
Impossible you say ? Well looking back in History you will find that in the early 1900’s the DOW made the following total returns:
1904 – 41%
1905 – 38%
1908 – 46%
1915 – 81%
1933 – 66%
I Would I have loved to been invested back then !
Of course things have slowed considerably in modern times as the market has matured but even going back to as recent as 1995 the DOW gained 33.5% followed in 1996 and 1997 by a 26% gain and a 22.6% gain respectively.
So my prediction may sound ridiculous to many but history shows it is not out that far out there. The question is what will drive a 30% gain in the next 16 months?
In my opinion the market, while in some areas is clearly over valued there are many that are still under valued. Corporate earnings have been great this year and the world stage is setting itself up for an economic boom to occur. Many investors are buying International stocks in anticipation of great performance outside the United States but I believe they forget that many of our companies operate on a global basis. I believe along with the weakened dollar these companies will see record profits in the coming months and of course will lead to great gains in the market. The only question is – Will you be the one sitting on the sidelines?
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