Many commentators are freaking out about a new Barron's headline celebrating the arrival (actually return) of the Dow Jones Industrial Average passing 14,000.
We'll refrain from singling any one out.
But the belief is that the following from Barron's means the market is about to tank: "We told you so. In October, we predicted the Dow would pass its 14,165 record by early this year. Now we're just 1% short. Expect a breakthrough soon. Here's what happens after that."
More generally, there are people who get nervous any time there's an article talks about a new bull market, or how everyone's into stocks, or how we've just breached a new era.
Basically, there are a lot of people who reflexively get negative, just because people have turned bearish.
As Josh Brown has noted, this so-called "headline" or "magazine cover" risk is total nonsense. A magazine cover is just a magazine cover. A headline is just a headline. A big benchmark is just a big benchmark.
We went through the history of the Dow, from the 1960s to today, to prove why this is complete hogwash.
(Many thanks to Barry Ritholtz and, again, Josh Brown for digging up some of the "deader" of the dead trees...)
For the sake of this feature, we can trace the first headline risk debunking to the May 31, 1963 issue of Time. It talked about a rising US economy.
Ok, stocks declined for about two months after that. Then they went up for a good while.
The Dow hit 1,000 for the first time in November 1972.
See the rest of the story at Business Insider
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