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The continuing financial crisis in Greece, slowdown in China, and worries over the U.S. economy have kept investors on their toes with a bull-bear roller coaster market. But could there actually be a Dow 100,000 in the not too distant future?

This is the optimistic prediction made by Philippe Gijsels, head of fixed income research and marketing at BNP Paribas Fortis.

 “If history were once again to repeat itself and stock markets would once again see a tenfold increase over a period of 25 years, the next magical figure of 100,000 for the Dow could come into sight. It sounds spectacular. However, this is the move that we have already seen twice over the last 80 years.”

While we are still a long way from solving the worldwide debt crisis, Gijsels believes that inves tors will reap the rewards of patience in the form of massive returns. To understand how this will occur, Gijsels points to periods where the Dow had literally no progress but then made substantial turnarounds. These periods included the 22 years following the big crash of 1929, the period following high inflation of the 1970‘s, and then from 1982 to 2000 with the burst of the Internet bubble.

In fact, according to Sean Udall of the TechStrat Report, there are several reasons to expect the bulls to thrive. 

  • Long-term cash flows from such giants as Caterpillar, 3M, Apple, Google, IBM, McDonalds, and Coca-Cola.
  • Higher U.S. GDP which indicates that future economic activity will stay in the 2-3% range.
  • The impact of Europe’s recession on the U.S. GDP is being overstated.
  • With money markets paying next to nothing, ten-year treasuries below 2%, and solid corporations at 3%, stocks are the most attractive alternative to any other savings mechanism.
Though some challenges do lie ahead, a Dow 100,000 milestone is not unreachable. Investors with time and patience will be dutifully rewarded when the time comes.

 
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Think the bull market is losing steam?

Give the market more credit than that — investors in Visa, MasterCard and American Express sure are, trader and author Daryl Guppy says in a new CNBC post.

Despite the usual fluctuations, retail credit markets have been growing steadily since last year, Guppy reports. Since September 2011, Visa stock has risen from $75 to $125 — a 66 percent increase, he notes.
It’s a noteworthy number, because when the 2008 recession hit, many American consumers shifted from credit cards to cash for purchases.

“Cash came out of the stock market,” according to Guppy’s post. “Cash was used to pay off credit cards and debt.”
As a result, consumption — and demand — plummeted.
But retail credit markets are pointing to persistent demand in the future.

“The chart of the Visa stock price,” Guppy concludes, “points the way to the future intentions of the U.S. consumer and they are bullish. This suggests that the Dow will recover momentum because this increase in personal credit demand will drive up consumption.

“For investors, the dips in the Dow trend are a long term buying opportunity.”
The key take-away here is that smart investors are always looking at what’s coming, not what happened last week. These numbers suggest what’s coming is a lot of reasons to invest now.
No holding back these bulls — Dow 100,000, here we come.