The theme this week on the Retirement Quick Tips Podcast is: Stupid Stock Market Predictions

Today, I’m talking about the prediction that came over 2 decades too late: Dow at 36,000. “Dow 36,000 was a book published in 1999, predicting that the Dow would reach 36,000 within a very short period of time - 3 to 5 years at the most. The Dow at the time was trading in the 10,000 range at the time, so this was a pretty bold prediction. 

This book was published right before the stock market tech bubble burst in the early 2000s and it took about 22 years, not 3 to 5 for the prediction to materialize. 

What’s the lesson here? Well, I think that it shows just irrationally exuberant investors were at the time, because this wasn’t some fringe book. It was a popular bestseller with endorsements from the likes of John Bogle, founder of Vanguard. The danger is that investors always feel the most optimistic when the stock market is at or near the top. In fact, one of the best ways to tell if you should start taking some gains and moving your money out of stocks and into something else is when everyone around you is optimistic about future stock market returns and telling you how the stock market is going to more than triple in value within just a few short years. 

It’s a pattern that repeats continuously in markets - whether stocks, real estate, or bitcoin, and it’s dangerous to get swept up in the thinking that you must jump on the bandwagon too without another thought so you don’t miss out. 

That’s it for today. But before you go, I have a request…I’m working on an upcoming theme for the podcast about financial goals, so if you made a new year's resolution or a goal for 2022 related to your finances, I want to hear from you. If you have a goal for 2022 that’s related to your finances or retirement, send me an email and let me know what your goal is and your game plan for achieving it. 

I’ll pick my favorite submissions and feature them on the podcast in the next few weeks. You’ll benefit from my feedback and insight, and help inspire other listeners to achieve their own financial goals for the new year. 

My email is [email protected]. That’s [email protected].

Thanks for listening! My name is Ashley Micciche and this is the Retirement Quick Tips podcast. 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance