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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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