[I've moved away from chatting about the markets, but this article has to be mentioned if only for the shock value]...
I thought I was negative about the economy over the coming year thinking we could hit DOW 8,500-10,000 (with unemployment reverse trending to the upside dramatically, say 12%+ in the US), but a recent article on cnbc has one pundit calling DOW 3,000 by 2013. Even guys like Nouriel Roubini or Marc Faber haven't tossed out numbers like DOW 3,000 (although they see a crash coming).
I'll admit, even I find DOW 3,000 hard to believe, although if enough dominoes fall at the right time it's feasible.
The market is already primed for panic, the only question is what's going to set that panic off (or on the flip side, what will defuse it). A lot of current 'ride it out' mentalities are born out of the same mentality associated with the 2008 crash - essentially investment managers who have to remain in the markets to have a job (and as such have to keep all those 401ks, RRSPs, etc. in the market as well).
Not to mention the FED keeping interest rates low and essentially forcing people to either be in equities (hence the recent rush in to high-yield dividend stocks) or gold if they want any shot at some kind of return (which to me is just insane to essentially force capital in to equities, thereby over exposing people's 401ks to a market crash should it occur).
But you know, if we ever did hit DOW 3,000 we should have a party, because we'll be celebrating our move in to a brand new era for mankind. I don't believe capitalism as we know it could survive DOW 3,000. Heck, I don't think we could even survive dipping back down to DOW 6,500 again. So hitting either one of those levels will usher in a brand new era that will be unlike anything we've ever seen.
Anyway,was it irresponsible for CNBC to run this article on their homepage (it wasn't buried in their site, it's the lead story)? It's hard to say.
If CNBC ran a headline saying "Author says russians planning nuclear attack on USA" - and yet it was merely said author's theory that this would happen - we'd call that irresponsible journalism. Yelling fire without proof of fire isn't good journalism.
Yet when it comes to the economy, theories are all anyone has to report on. As such, who is to say DOW 3,000 isn't possible.
All I know is that it's unnerving to see a top-tier media outlet pushing this kind of headline. Even with my money out of the market, DOW 3,000 is a Mad Max type scenario that I wouldn't want to see unfold.
I thought I was negative about the economy over the coming year thinking we could hit DOW 8,500-10,000 (with unemployment reverse trending to the upside dramatically, say 12%+ in the US), but a recent article on cnbc has one pundit calling DOW 3,000 by 2013. Even guys like Nouriel Roubini or Marc Faber haven't tossed out numbers like DOW 3,000 (although they see a crash coming).
I'll admit, even I find DOW 3,000 hard to believe, although if enough dominoes fall at the right time it's feasible.
The market is already primed for panic, the only question is what's going to set that panic off (or on the flip side, what will defuse it). A lot of current 'ride it out' mentalities are born out of the same mentality associated with the 2008 crash - essentially investment managers who have to remain in the markets to have a job (and as such have to keep all those 401ks, RRSPs, etc. in the market as well).
Not to mention the FED keeping interest rates low and essentially forcing people to either be in equities (hence the recent rush in to high-yield dividend stocks) or gold if they want any shot at some kind of return (which to me is just insane to essentially force capital in to equities, thereby over exposing people's 401ks to a market crash should it occur).
But you know, if we ever did hit DOW 3,000 we should have a party, because we'll be celebrating our move in to a brand new era for mankind. I don't believe capitalism as we know it could survive DOW 3,000. Heck, I don't think we could even survive dipping back down to DOW 6,500 again. So hitting either one of those levels will usher in a brand new era that will be unlike anything we've ever seen.
Anyway,was it irresponsible for CNBC to run this article on their homepage (it wasn't buried in their site, it's the lead story)? It's hard to say.
If CNBC ran a headline saying "Author says russians planning nuclear attack on USA" - and yet it was merely said author's theory that this would happen - we'd call that irresponsible journalism. Yelling fire without proof of fire isn't good journalism.
Yet when it comes to the economy, theories are all anyone has to report on. As such, who is to say DOW 3,000 isn't possible.
All I know is that it's unnerving to see a top-tier media outlet pushing this kind of headline. Even with my money out of the market, DOW 3,000 is a Mad Max type scenario that I wouldn't want to see unfold.
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