Wir life in the age of Hyper-acceleration. Nowhere is this so clear as on the stock exchange. Only a few days after the inauguration of Donald Trump, the Dow Jones, the main stock index in the world has exceeded now the historic mark of 20,000 points. Almost more remarkable than the new threshold, the pace of the stock market rally. The Index for the first 10,000 points of its history for nearly 103 years, needed he made the last of the 10,000 meters in less than 18 years of age.
“The people voted, first with the ballot, have to do with the purchase of shares,” says the well-known Wall Street Guru Ralph Acampora, the “world”. The enthusiasm was typical of the Honeymoon Phase with a new President. “As with Ronald Reagan, the positive stock market should be enough sentiment in the first year of a Trump presidency,” says Acampora, a technical Analyst at the investment company Altaira Capital Partners.
Trump is likely to self-ascribe the stock market’s success. Finally, the Dow has gained since his election, with 12.6 per cent and the Index the necessary momentum to break Through the psychologically important mark awarded. Three election promises of the new President to solve the euphoria among investors: hope is a multi-billion dollar economic stimulus program, less regulation and lower taxes.
unrealistic expectations about Trump
Some experts believe the rally is exaggerated. In particular, the political and economic expectations to the new President could be plated out. “The markets could Wake up in a month and find that you had the wrong hopes. The whole Trump-rally could quickly fall back," warns the money-Economist Barry Eichengreen.
As the Dow on September 16. March 1999, for the first Time in its history, the 10,000 threshold, took, belonged to Acampora, at that time at the investment house Prudential, to the pathetic Jublern: “It is exciting! It is America. We should all stand up and sing ‘God bless America’. Our shares lead the world. It is anything other than irrational."
A book predicted a Rise to 40,000 points
The Dow Jones is a stock market index of the masses. If somewhere outside of the economic life of share the speech is, certainly, the popular Index. A representative role in the financial markets due to its ancient method of calculation only. For the current Dow-are expected to Stand the stump of the courses of each of the 30 index members.
things such as market value, for other market barometer is the basis for the weighting, is not familiar with the Dow Jones Index. Therefore, the iconic market barometer often leads a life of its own. So also this year. The Index is up more than 14 percent, while the competitor S&P 500, only eleven percent of their value has gained. The Tech Index Nasdaq is lagging with a growth of nine per cent.
The 20,000 mark, although rationally, not really relevant to the meaning. But no one should underestimate the psychological power of such round Numbers. As the Dow in March 1999, he moved to the 10,000 of the millions of small investors to the stock market. The euphoria knew no bounds. Legendary the book “Dow 40,000 in” by David Elias. The investment adviser said on 209 sites for the year 2016, a fourfold increase in the Index in advance.
Some of the setbacks to the 20,000
The global and technological nature of the American economy will drive investment in the United States and with more aggressive American savings models, the Index forward. In addition, a further privatisation of the social insurance huge amounts in the stock would blades market, and thus the courses in addition to drive.
To a quadrupling it didn’t get well known, and also the doubling to 20,000 meter was not done without some massive setbacks. Two full-blown crises threw back the Index after the Burst of the New Economy bubble in an area of 7000 points in the financial crisis of 2008/2009, the market barometer slipped temporarily to 6547 counter.
But the course proved to be falls as an excellent entry-level opportunities. Who courageously at the Low in March 2009, the Dow access, could increase, including dividends, to its use by 150 percent.
in Spite of the 20,000 he rally is not charged, the General mood on Wall Street, such as the turn of the Millennium. Currently no books on the market, the promise of 100,000 points in the Dow. And this suggests that the pace could accelerate up to the next 10,000.