![]() ![]() ![]() Our book was praised by several of the gods of buy-and-hold investing, including the late John Bogle and Knight Kiplinger. I have been a buy-and-hold fanatic for 40 years of writing about stocks and, still, Americans don’t own stocks, or they jump in and out of them. What is really disappointing is that a lower proportion of American households own stocks, stock funds, and stock investments in 401(k)s today (56%) than did when we wrote the book (60%), according to Gallup. Though, again, I wouldn’t change the name of the book. Is it frustrating that that message got overshadowed by the focus on the name of the book?Ī. The book’s main takeaway about the benefits of buying and holding a diversified equity portfolio seems to be the most under-appreciated thing about it, even all these years later. I have learned a lot about risk since writing the book, as have all Americans with such events as 9/11 and the Covid pandemic. Our mistake was to define risk in only one way – volatility of stock prices. The late Alan Meltzer, a serious economist and student of the Fed who gave our book a very nice blurb, told me, “Never associate a date with a number.” Good advice.Īlso, as I have written several times, I believe we were mistaken to believe that investors were “wrong” in demanding high returns to compensate for extra risk that equities, in truth, did not possess. What I do regret is intimating that Dow 36,000 was going to happen soon, that is, within a few years. President Bush hired me to run his policy institute, and I have done consulting for lots of Fortune 500 companies. I got confirmed twice, unanimously each time, by the U.S. I have done a lot of things, and I doubt D36K affected them one way or another. I’ve had the career I’ve had, and it’s hard to imagine an alternative one without D36K. With the Dow finally hitting the target, we reached out to Glassman for a Q&A to fill in some of the blanks about his experience with “Dow 36,000.”Ī. “And they demand a higher return from them, no matter what history shows.” “Investors set the price for stocks,” Glassman wrote in Kiplinger this year. Glassman has written extensively about what he believes they got wrong in the book, including not appreciating the lingering nature of the equity risk premium the authors believed would dissipate. Harvard’s Kenneth Rogoff even wrote a Wall Street Journal op-ed in September arguing “ Why the Dow 36000 Forecast Was Right.” And aside from the title and the math that got the authors to 36,000, the underlying message of the book-that a buy-and-hold diversified portfolio of stocks is the best bet for investors over the long term-has stood the test of time. Bush and Hassett as a chief economic adviser for President Donald Trump. Still, both authors went on to prominence in Republican circles Glassman as an under secretary of state for President George W. It would be called, among other things, “perhaps the most spectacularly wrong investing book ever.” That was in the Washington Post-the same paper where Glassman worked as a columnist. Still, Glassman said in a recent interview that he has no regrets about the eye-catching title of the book, even though it took on legendary status as an emblem of out-of-control investor optimism during the dot-com era. The only problem? The book was published in September 1999 and the authors guessed the 36,000 level would be reached in three to five years-not the 22 years it actually took. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |