Dreman has a chart in his book of the US stock market going back to 1802. It is pretty much a straight line up.
My observations over this "discussion" on what index matters and why "some" say we should ignore the NASDAQ.
1) In 1802, my guess is , agriculture, mainly tobacco & cotton plus transoceanic shipping were big businesses back then. Was there a steel industry?
2) 1865 or so.... transcontinental railroads and steam engines for ships lead the industrial revolution. Steel industry started to become a big deal. I wonder if the plantation owners laughed at the upstart steel investors?
3) 1906 or so... Model-T, assembly line and Write Brothers airplane. Horse and buggy industry was probably not a good investment. Tons of companies came out making autos... only a few are still here 80 yrs later, but I bet some good money was made by the good ones. I wonder if the horse traders thought investing in the auto was folly as it needed gas and you couldn't use the "by product" to fertilize your garden?
4) 1973 - Vietnam, OPEC draft dogers fleeing to Canada and "Made in Japan" now means QUALITY. Exxon, McDonnel Douglas, etc.... big deals.
5) 1984 MacIntosh. HP-150, Atari, IBM PC, etc... In the next 15 yrs we went from 10 secretaries for 50 engineers to about 3 and they used a PC to schedule meetings.
6) 1993 Internet.... AOL soon invades with inferior but easy to use technology what us geeks were using for 20 years... The genie was out of the bottle! Evene I laughed at what some were willing to pay for AOL and Yahoo! Those I laughed at laugh at my folly. I learned a valuable lesson.
7) 1998/99 ... obvious to me and many others that fiber optics and wireless and ICs and such will be necessary to grow business that is taking to the internet nearly as fast as AOL spammers. Some of us invest in some of these areas and make a small fortune. Of course, we are called "bubble heads" and worse. I like getting laughed at... I learned from the AOL investors.
8) 2000 ... some laugh and say that Intel, AMAT, LRCX etc. are not going to be more important than Exxon or the steel industry of the past. They long for the days of the buggy when investing was easy... except the times changed even back then, just at a much slower pace.
regards
Kirk |
