Dow 20,000 in 5 years?

[Vanraw]

Agree on the military reserves to a point. But the biggest hit will be in military contractor reductions. But we need to start taking the medicine and stop spending so much.

As far as bubbles, it might be energy again. Right now OIL and oil futures are being horded with expectations of some sort of Iran / US war or action.

Then again it might just end up being an investment bubble. The DOW is nearing record levels. Corporate earnings are high, but unemployment is high. And on top of that, there is a massive amount of investment dollars that are going to start leaving the market as the baby boomers are going to be drawing from investments and even removing money in the market to interest based secure investments.

In the end the market must settle to the powers of supply and demand. That is to say, the cost of a share of stock and its multiples are not governed by earnings, but interest in buying the stock. If and when serious money starts to leave the market, prices will have to be impacted.

Keep in mind that as the baby boomers retire, there will be 60% of our population retired and no longer adding productivity to the economy, but more importantly no longer investing in the economy or the market. In addition, retired people stop spending at the same levels as when they are working and earning income.




for the past 20 years or so, all our bubbles are market makers driving prices