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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bobby beara who wrote (36373)	1/1/2000 2:12:00 PM
From: KyrosL	Read Replies (2) \| Respond to of 99985

1 million Dow by the end of the 21st century is not excessive -- you guys forget the power of compounding . There are 100 years between now and then. To reach 1 million (i.e. 100 times more than it is now), the Dow will only need to increase a bit more than 4.7% a year. Historically, stocks have risen 9% a year on the average. If they do that over the next 100 years, the DOW will be at 10,000*(1.09)^100= 55,290,000 by the end of the century. That's 55 million. So, Templeton's estimate, if anything, was very pessimistic compared to historical norms. In fact, if stocks revert to the historical average increase of 9% a year, we should see Dow 1 million by around the middle of the 21st century.