Word: dow
(lookup in dictionary)
(lookup stats)
Dates: all
Sort By: most recent first
(reverse)
...first major challenge for Treasury Secretary Larry Summers, 44, the economist who succeeded Robert ("Just Right") Rubin three months ago. Summers' mantra--"A strong dollar is in the national interest of the United States"--was the same one repeated for six years by Rubin, a period during which the Dow rose a mountainous 7,000 points. In contrast, the as yet brief Summers era has seen the index drop some 900 points. But Summers says his focus is on "the fundamentals," such as creating a budget surplus, which he argues is best for both the economy and the markets...
...needed more light anyway. But if a third tree topples, stop the presses. There must be some hideous new insect at work, threatening the entire forest. And that's a story. So it is with a trio of recently published books, and I'm not making these names up: Dow 36,000 by James Glassman and Kevin Hassett, Dow 40,000 by David Elias and Dow 100,000 by Charles Kadlec (no relation). I'm thinking of writing one called Dow Infinity. Top that...
Books about the market's direction are pure guesswork. Elias and that other Kadlec as much as admit that there's nothing special in their forecasts. Elias predicts Dow 40,000 by 2016, an average annual gain of 9%. Kadlec projects Dow 100,000 by 2020, equal to 11% a year. Given that stocks have returned 17% a year over the past 20 years, it's hard even to call them bulls. About all they're saying is that the U.S. will remain a sovereign nation. I'd call that a real sturdy limb they've climbed onto...
Glassman and Hassett are a different breed. They predict that the Dow will go to 36,000 in short order, gaining something like 35% a year for the next four years. Now there's a thin bough. They believe investors are revaluing stocks to a permanently higher plateau. It's a fun argument but boils down to familiar ground: diversified portfolios are superior and safe if held for long periods. A growing awareness of that idea is bringing more investors into the market at ever higher prices, inflating the average stock's price-to-earnings multiple from...
...sitting tight when the market turns choppy or goes flat for years. But here's my prediction, and you don't even have to buy my book: short-term risk will become more apparent in coming years, keeping a lot of money out of the market and the Dow below 36,000 long after this year's freshman class joins the work force...