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Dow 1998-2008

Gosh it was only six years ago that I cemented my place in stock market history by
predicting that the Dow would fall from 8,500 to 5,000,
instead of going up to 14,000 where it peaked in October of 2007
Bill Gross, December 2008

Well, I could use the standard set of excuses:
1) No one else saw it coming, 2) I was misinterpreted, and taken out of context, 3) I was tired, overworked, and had family problems, or 4) I had just come out of rehab. But these days what really works is a full confession. I mean, like, uh, it was totally my fault and I take full responsibility.
The fact is I was only off by 9,000 points. That’s my story, and I’m stickin’ to it.

This time though I’m definitely older and maybe a little bit wiser. No magic number, nor a specific target date from the Swami of the Dow. This one will be more conceptual, but still present a “take” that you can criticise or damn with faint praise. And no, despite the title, it doesn’t imply that the stock market is headed to 5,000 and that I was always right or just a little bit early. It only suggests that I’m readdressing the critical topic of equity valuation – that mysterious fragile flower where price is part perception, part valuation, and part hope or lack thereof.

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