DOW 25k by 12/31/2017

[38Chevy454]

X2 the market's hoped for tax changes seem to make 25K a more likely result. Of course, it is not law yet, has to go through compromise to get the House and Senate versions to be the same before it can signed into law. However that also seems like it will happen, and certainly Pres Trump will sign it. Once legal law, I think it will put it over the 25K. Assuming no other significant bad news event.

[audreyh1]

No one is expecting a sell on the news event?

[jollystomper]

I expect there will be some sell-off once the tax cut compromise bill is finalized and people get their latest perceptions of the "winners" and "losers" in the final bill that is signed into law.

[tinlizzy]

idk...the losers are unlikely to make a dent.

[ponyboy]

lol...by dec 31st? We'll be at 25k by the end of this week, lulz

[Free bird]

Is the fed selling $60 billion of their paper per month? They're making a killing.

[audreyh1]

Quote:

Originally Posted by Free bird Is the fed selling $60 billion of their paper per month? They're making a killing.

The Fed isn't selling anything, just not reinvesting bonds that have matured.

Interest rates have crept up a bit. I doubt they would make a killing even if they sold bonds before maturity.

[Free bird]

25k next week?

[W2R]

Quote:

Originally Posted by Free bird 25k next week?

Only 340 more points! (at the moment)

And we have 16 days until December 31st... I wonder! I wasn't sure it was possible, but we might get there.

Watching the market has been so much more fun than watching sports, lately.

[Free bird]

Passing the tax bill will add 500 points.

[GrayHare]

Quote:

Originally Posted by Free bird Passing the tax bill will add 500 points.

Futures are already up about 1%. Can't recall seeing that on any prior Friday evening.

[DrRoy]

A couple years ago my equity AA was in the low 80's. As the market rose, and I approached RE (last March) I made measured, permanent steps to reduce it. This year I made 1% moves in February and early this month, to now 60%. If things keep climbing, I will continue with the 1% moves to an ultimate target of 55%, if the rally continues to hit my preset trigger points over the next year or more.

[easysurfer]

Quote:

Originally Posted by W2R Only 340 more points! (at the moment) And we have 16 days until December 31st... I wonder! I wasn't sure it was possible, but we might get there. Watching the market has been so much more fun than watching sports, lately.

I just want the market to hang on til the end of year. Then after re-balancing, I'm ready for the great crash of 2018 .

[KB]

Quote:

Originally Posted by easysurfer I just want the market to hang on til the end of year. Then after re-balancing, I'm ready for the great crash of 2018 .

+1

[NW-Bound]

I wonder how many people are waiting to rebalance on Jan 2nd, 2018. If there are a lot like that, you may want to front-run them.

I have a few semiconductor stocks. Their price rise YTD has beaten that of the market, yet the P/E is not excessive and sometimes even lower than that of the market. The forward P/E ratio is ridiculously cheap compared to that of the S&P.

Yet, these stock prices dropped quite a bit the last 2 weeks. There was no news. The entire sector was sold off. The word was that investors were cashing out. I did not beat them out the door, so I am not selling, er, rebalancing out now.

[Free bird]

Come on 25k. Were within spitting distance. Just do it.

[W2R]

Quote:

Originally Posted by Free bird Come on 25k. Were within spitting distance. Just do it.

+1000

I can hardly believe it! At the moment it is at 24,835, which would be just 165 points short of 25,000.

Watching the Dow today feels like watching a horse race.

It's been a little over 10 years since I posted that infamous "Wheee!!!" post. But just think - - the Dow was only just barely over 14,000 then, and now it is at 25,000. Seems almost unbelievable.

[EvrClrx311]

Some fun context...

Equities as a whole have been shown to grow consistently at around 7.1% after inflation (more specifically, 6.8% to 7.3% over all rolling 40 year periods). So we can anchor the DOW to this 7.1% real return mean linear line over a LONG horizon. In 1, 5, 10, 15, or 20 year spurts it can do much different things, but over 40, 60, 75, 100 years it sits at 7.1%...

So how does that project onto the 14,000 DOW from 2007 vs the 25,000 today... $14,000 in November 2007 becomes $16,430 in Nov 2017 dollars.

So in 2017 dollars we see the 2007 DOW as $16,430... now applying this 7.1% LONG term linear line (the regression gravity of our market)... we can say that the 2007 peak of $16,430 (today's dollars) is $32,629 today.

We still have a little ways to go if we're going to get to the exuberance experienced in 2007. 30% more to go in fact. Of course, the market doesn't work so nicely. The bottom can fall out anytime between now and then... or it might fall out after then. If you get that part figured out, please let me know

And we'll dance around it in the mean time. I've spent a great deal of time trying to decipher exactly where that median (100 year) line SHOULD be today... I keep coming up with a number like 18,000. We'll regress eventually... through flat years or pull backs. And spend equal time above and below it in the long run, as it grows at 7.1% every year

I do suspect the 7.1% will continue for the long haul, but I can't say for sure.

Every decade the market tends to double... at least on a LONG horizon. This is why the number 100,000 by 2050 is thrown out there. Makes your eyes pop, huh?

[Free bird]

Risk appetite animal spirits tax cuts $trillion dollar deficits oh the humanity

[W2R]

Quote:

Originally Posted by EvrClrx311 Every decade the market tends to double... at least on a LONG horizon. This is why the number 100,000 by 2050 is thrown out there. Makes your eyes pop, huh?

If I am still alive in 2050 (at age 102), and if the Dow hits 100,000, I promise you will hear a faint "WHEEE!!!" coming from my house or from an old folks home nearby.