Tags: Dow | 100 | 000 | 20 | Years

Ultimate Bull? Author Says Dow Can Hit 100,000 in 20 Years

By    |   Monday, 07 Nov 2011 12:49 PM

Author Matthew Kidman says that if historical performance is used as a guide, it’s possible for the Dow Jones Industrial Average to soar to 100,000 in 20 years.

Kidman, author of "Bulls, Bears & A Croupier," told CNBC that inevitably, equities are primed for a massive bull run, despite continued volatility.

Kidman told CNBC he believes that both the U.S. and Australian stock markets are currently in bear market terrority, but the losses — about 20 percent in five years — make ideal conditions for a strong rebound.

Kidman's beliefs are supported by looking at the nearly 10,000 point gain the Dow saw from 1982 to 2000. He also finds significance in the fact that in 1974 the All Ordinaries Index in Australia was down to 220 but 13 years later, it rose to 2,400.
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A USA Today article supports Kidman's optimism, reporting that history shows the stock market shifts into rally mode after it narrowly dodges bear markets, or drops of 20 percent or more, according to data from Standard & Poor's.

wallstreetbullap200v1.jpg
(Associated Press photo)
USA Today adds that stocks also tend to rebound after mild bear markets, or "baby bears," that end with losses limited to, say, 20 percent to 22 percent.

There are signs that the fear that was blamed for much of the volatility in global markets is waning. Investors appear to be finding comfort in recent economic data from the US, which shows some improvement, and it appears Europe's efforts to address their economic problems are providing additional relief.

USA today says that, if the U.S. trend continues and Europe's plan doesn't fall apart, historical data point to stock gains ahead.

Kidman told CNBC that surging 1,000 percent over 10 to 15 years is a conservative forecast.

This isn't to suggest that markets will rebound immediately, because some declines are still expected. But, that may be positive for investors, creating what Kidman describes to CNBC as "once-in-a generation" buying opportunities.

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Author Matthew Kidman says that if historical performance is used as a guide, it s possible for the Dow Jones Industrial Average to soar to 100,000 in 20 years. Kidman, author of Bulls, Bears A Croupier, told CNBC that inevitably, equities are primed for a massive bull...
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Monday, 07 Nov 2011 12:49 PM
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