Stock traders almanac is speaking yet again, this time DOW 38k by 2025!!

Discussion in 'Wall St. News' started by S2007S, Oct 28, 2010.

  1. S2007S


    Why should anyone work when the stock traders almanac can predict every move in the market, the entire population should own a copy of this book. 38k by 2025, now that is going to be amazing, remember when the Nikkei was above 40k, hahahahaha, now its under 10,000, the markets could fly to 38,000 and quickly drop back below 10,000. I love the hype these people write about. Always makes me laugh.

    A 'Super Boom' in Stocks? Dow 38K by 2025, Says the Stock Trader's Almanac
    Posted Oct 28, 2010 11:38am EDT by Peter Gorenstein in Investing

    In the near term stocks may be in the "sweet spot," according to Stock Trader’s Almanac Editor-in-Chief Jeffrey Hirsch, but don't confuse that for a bull market … YET.

    If history is any guide, the secular bear market that began in 2000 still has about seven more years before the bulls take over. And when they do, get ready for what Hirsch describes as a "super boom" in stocks.

    "The super boom's not really going to kick off until 2017 after we shake out all this financial crisis," he says. He predicts the Dow will hit 38,820 in 2025, a 500% gain from the intraday lows of March 2009.

    Here's how he recently explained it to his subscribers:

    "From the last bottom in 1974 it took eight years before the market really took off in 1982 and then another eight to move up the rest of the 500%, in line with Yale Hirsch's prediction in 1976 for a 500% market move by 1990. A 500% rise in the Dow over 16 years from the intraday low of 6470 on March 6, 2009 would put the Dow at 38,820 in 2025."

    It's more than just wishful thinking -- it's a return to the market's norms. It only takes a 7%-8% gain, compounded annually, to get to 38,820, Hirsch notes. In fact, the Dow rose 1,400% during the bull market of 1982 to 2000.

    What, then, will drive this super boom?

    First, the end of war brings peace and a generally pro-business environment. It happened after World War II and Vietnam, and Hirsch bets it will happen after the wars in Iraq and Afghanistan.

    Second, inflation. "After all the major wars of the 20th century," stocks took off, "when the inflation from government spending kicks in," says Hirsch.

    Third, enabling technologies. Hirsch points to the assembly line after World War I, which revolutionized business; suburban expansion after World War II that created a middle-class consumer in need of appliances and more homes; and after Vietnam it was IT and communications that sparked innovation. Renewable energy and biotechnology, Hirsch believes, will be the next big thing.