The Biggest Boom To Hit The Dow
“You’re positive on stocks?” my client sputtered.
It was January of this year. The mood was bleak. Stocks were plummeting. The Dow Jones Industrial Average was hovering around 16,000. Everyone believed that another crash was coming.
“Yes,” I told my client, “I’m positive on stocks.”
Not only was I positive on stocks, but I also told my client that by year-end, the Dow would be at new highs.
He gasped. However, it was what I said next that almost made him choke…
“I believe we’re about to experience the biggest boom in history that’s going to send the Dow to 50,000 … and then beyond.”
I was so confident because I understood something my client didn’t — the secret force that will cause an economic boom in the U.S. and drive the Dow Jones Industrial Average to record levels in a spectacular bull market.
Understanding the Secret Force
You see, this secret force triggered the previous great bull market, which ran from 1982 to 2000 and generated gains of over 1,000%. And my research also shows this same secret force triggered every major bull market before now.
That secret force is people.
It’s the collective earning power of a massive group of people — a generation — coming to spend their money in great waves on big-ticket items such as homes and cars. Economists in their technospeak call this household formation.
That’s exactly what is going on today with the millennial generation. Millennials are the group of Americans who are between the ages of 18 and 34, with the oldest hitting the age of 18 in the year 2000. This generation is now coming into a 15- to 20-year period of rising earning power.
And our research shows that every generation going through this period uses their earnings to buy houses and cars … and then have kids — on whom they spend even more money.
This spending creates huge economic growth because buying a house means business for bankers, neighborhood hardware stores, home-goods retailers, contractors and so many other businesses. And this spending keeps going through the upgrading of homes or selling the first house to buy a newer, bigger one.
Paul Mampilly joined The Sovereign Society in 2016, and serves as Senior Editor specializing in helping Main Street Americans find wealth in growth investing, technology, small-cap stocks and special opportunities.
Paul Mampilly joined The Sovereign Society in 2016, and serves as Senior Editor specializing in helping Main Street Americans find wealth in growth investing, technology, small-cap stocks and special opportunities.less