Can you believe that at this moment the Dow is near the 18,000 mark?

Discussion in 'Stock Market Forum' started by Allison2021, Dec 5, 2014.

  1. Allison2021

    Allison2021 Well-Known Member

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    Can you believe that at this moment the Dow is near the 18,000 mark?
    What does this mean for our economy? Does this mean Americans are holding a lot of assets?
    Otherwise is this some kind of bubble?
     
  2. Rosyrain

    Rosyrain Senior Investor

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    What this really means is that I am highly jealous of someone who can afford to buy even one stock from them :) In all seriousness though, it sounds like the economy is improving because I remember a time not too long ago when a big day on the stock market was when it came in at 11k. I hope this means that I will be able to find a new job soon because I am going crazy at the one I am at. A good economy translates to good times for all.
     
  3. JR Ewing

    JR Ewing Super Moderator Staff Member

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    I think it's a bit of a bubble facilitated by the Fed's continued easing over the last 6 years.

    I'm not hoping for a crash or anything, but I don't know how much higher this will go. I'd be shocked to see the S&P 500 surge beyond a 20 composite PE valuation. But stranger things have happened.

    Either way, I continue to be bottom up, to have at least a few put / short positions, some commodities exposure, and to keep some cash available for future investment opportunities. I wouldn't be surprised to see a correction once rates start going up.

    And the big drop in the price of oil could cause issues to spread beyond oil companies and into the financial institutions that buy and issue their debt and equities, and into other areas as well.
     
  4. Rosyrain

    Rosyrain Senior Investor

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    You have some we good theories and I agree that the rise will probably not last. There will be elections and things coming up that will probably start to spook people. It sure is a good sign though that people are starting to trust the economy more.
     
  5. turt

    turt Guest

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    It just means that most of the money is the hands of more wealthy people who tend to have a lot of excess to invest in the market. However, I really have no idea how much further this can go since easing has stopped.
     
  6. troutski

    troutski Guest

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    It's probably a small bubble that's going to do minor damage when it bursts. Still, the economy is chugging along, and investors are being bold because of that growth. Interest rates are still low, oil prices are dropping, and a lot of positive developments are being made. The markets are definitely a little overvalued in general, but a correction or slight sell-off wouldn't be the end of the world in the short- or long-term. I'm thinking indexes will climb a little higher and then maybe drop for a small period before crawling forward once again.
     
  7. ally79

    ally79 Guest

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    I think it is a bubble, but that's just my opinion. Oil prices and low interest rates are certainly helping the picture appear rosier, but I just don't think that it will last.
     
  8. gats

    gats Senior Investor

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    I think the lowering oil prices have much to do with the optimism of the market as well. I have a feeling the oil prices will go back up and this little bubble will burst as we get further away from this election season.
     
  9. troutski

    troutski Guest

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    Oil price don't need to rise in order to negatively affect the stock markets. The Dow is now down to 17,200, and investors are starting to tame their expectations of growth. 2015 should see the markets slow down for a variety of reasons, although some growth will still be there. Like I said before, I'd call this a small bubble rather than anything that's going to shake investors to their knees.
     
  10. petesede

    petesede Guest

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    obviously, and that can be said about any Bull market. Everyone knows it goes up and down, it is just a matter of when.

    IMHO, it all depends on the Saudis and how long they are willing to let oil sit this low. Low oil prices trickle through the entire economy in a huge way. It makes it cheaper to transport goods, and it adds money into the pockets of consumers directly.
     

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