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Dow 5000?
Could the DOW hit 5000? Bill Bonner in Contrarian Profits 10/14/08 Sure thinks so .....here are some comments from Mr Bonner
"Dow 5,000 is our target.
When the Dow gets below 5,000 we might be tempted to buy. Until then, it’s sell… sell… sell.
Mr. Market is a decent chap, after all. He always gives you opportunities to get out… or get yourself in deeper.
After the market crashed in ’29 for example, prices gained 18.8% over the next two days. Investors should have hit Mr. Market’s bid. Instead, many were convinced that the bottom was in. They took advantage of an opportunity to buy shares at ‘bargain’ prices – only to see them cut in half… and cut in half again.
And then, they had to live with their mistake for a long, long time. Prices did not return to the ’29 high until the 1950s."
"Government control of an economy has never led to stability or prosperity. In fact, the record is fairly clear – the more the state meddles, the worse the economic results.
In extreme cases, such as the Soviets’ 70-year experiment with a command economy, the results were so spectacularly bad that – at the end of it – Soviet industry had become ‘value subtracting.’ That is, it mobilized an entire economy to extract valuable resources… to ship them… to refine and process them… and to turn them into finished goods. And at the end of the day, the finished products were so badly made and so out-of-touch with what the market wanted that they were worth less than the resources that went into them!
No one is planning to recreate the Soviet system. Instead, they’re thinking that maybe a little political supervision would be a good thing. And who knows; maybe they’re right. We just don’t know of any theory or experience that leads us to think so.
But the fix is in and who are we to argue with it? Paulson is busily giving $700 billion of the taxpayers’ money away to his friends on Wall Street. The British are trying to save the City. And the French? What they don’t know about crony capitalism – at the public’s expense – is not worth knowing."
I do not subscribe to his newsletter , nor would I have any comments to make about it. If you feel so inclined Google it for further infromation!
"Dow 5,000 is our target.
When the Dow gets below 5,000 we might be tempted to buy. Until then, it’s sell… sell… sell.
Mr. Market is a decent chap, after all. He always gives you opportunities to get out… or get yourself in deeper.
After the market crashed in ’29 for example, prices gained 18.8% over the next two days. Investors should have hit Mr. Market’s bid. Instead, many were convinced that the bottom was in. They took advantage of an opportunity to buy shares at ‘bargain’ prices – only to see them cut in half… and cut in half again.
And then, they had to live with their mistake for a long, long time. Prices did not return to the ’29 high until the 1950s."
"Government control of an economy has never led to stability or prosperity. In fact, the record is fairly clear – the more the state meddles, the worse the economic results.
In extreme cases, such as the Soviets’ 70-year experiment with a command economy, the results were so spectacularly bad that – at the end of it – Soviet industry had become ‘value subtracting.’ That is, it mobilized an entire economy to extract valuable resources… to ship them… to refine and process them… and to turn them into finished goods. And at the end of the day, the finished products were so badly made and so out-of-touch with what the market wanted that they were worth less than the resources that went into them!
No one is planning to recreate the Soviet system. Instead, they’re thinking that maybe a little political supervision would be a good thing. And who knows; maybe they’re right. We just don’t know of any theory or experience that leads us to think so.
But the fix is in and who are we to argue with it? Paulson is busily giving $700 billion of the taxpayers’ money away to his friends on Wall Street. The British are trying to save the City. And the French? What they don’t know about crony capitalism – at the public’s expense – is not worth knowing."
I do not subscribe to his newsletter , nor would I have any comments to make about it. If you feel so inclined Google it for further infromation!
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