Hi Zeev,
"Ask yourself a very simple question, can it get much better?"
You raise an interesting question, which is a view point I had not previously considered. I have given it a lot of thought before putting pen to paper (or bytes thru cable) on this subject.
We both agree I believe that the market fundamentals are good. Disregarding short term blips like black Monday, historically the DOW has never moved to a lower plateau. It has periods of growth,
plateaus, delays and continues.
The DOW is of course distorted. It represents the top 30 capitalised companies. The lame ducks get dropped and replaced. For this reason in the past major bull market most fund managers could not match performance with the DOW, because these few stocks were outperforming the rest (obviously with exceptions)
The second reason I don't think it will happen is interest rates. Theoretically, it is company profit levels which determine their stock prices. But in reality, it's supply and demand. If their are more VECO bulls than bears, then the price will go up.
Due to very low inflation in most industrial countries, Joe average is looking for more profitable returns on his money than maybe th 3% fixed interest rate the banks will offer him. So where does his money go, more than likely direct into stocks or an investment fund.
What I am saying is that so long interest rates remain low, there will be enough fuel for the fire.
You could argue that Japan was in the super low interest rate senario at the begining of this decade, and the Nikkei still went deep south, but that was an insular situation.
Regards
Alan
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