The Zen of Dow

For a very long time, the Dow industrials hovered around 1000. Then because of Reganomics, or Voodoo Economics, the Dow tripled in one term, leaving us with the first major bubble. If popped, leaving Bush Sr with the mess to clean up. His term ended with an even higher mark than when he came in.

Then there was Clinton. Because of Y2K, the clinton years were blessed with a bubble that was known to have a fixed end date, plus a couple of financial wizards making for unbridled prosperity for precisely his term. Once the threat of the y2k bug was over, the computer market deflated (much the way a blister does when the burn is gone) and the market should have returned to about 4000. But it didn't, because Dubya wanted to keep things moving upwards. And they did everything to prevent what is happening right now.

Okay, without the artificial, and temporary need for 100s or 1000s of geeks, and without a housing market that was clearly cheating someone, the market needs to return to the pre-inflationary levels. Wall street will have to take it's belt in a bit, and the cold war will have to finally end. Does this mean socialism for all? No, but another "new deal" is already on the table (look it up). I'm predicting that the current price of stocks at 6600 will drop another 2500 points before this all ends, then at about 4000, we'll begin a reasonably stable rebound.

But under Obama, it will NOT be like it has since the 80s, buy low and sell high will be for the people who actually do the investigations not just any scammer that can get a trading ticket. Getting rich in the market won't be just a matter of getting as much money in as possible, it will be a very hard and difficult journey. That said, I think this will also end a lot of our globalization as people will start to invest in the things they can see: local businesses and brands, and not on vague speculations like the last 30 years.