Dow 4,000 | TheaterFire

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FoppyRETURNS@reddit

Then 10,000 during the dotcom era. Shows you can quintuple the wealth but no one knows where the money went. 💀

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The DOW is just the combined stock price of 30 big companies. It doesn’t account for inflation and has a goofy weighting (or lack thereof) of the 30 companies. “Wealth” hasn’t quintupled since the dot com boom. The DOW is a pretty useless indicator of market performance, it just gets reported in the media a lot because it always goes up.

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59apache01@reddit

I agree. It's just one of many market performance indicators. Never understood how it became the "gold standard" of the health of the entire stock market.

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Administrative-Egg18@reddit

It started in the 1890s. Nobody was going to calculate the market capitalization of hundreds of companies in real time before computers.

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kevstev@reddit

I work in finance and why the DOW endures as a benchmark continually confuses and irritates me. The SP500 is a much better benchmark since so many people own it via mutual funds, etfs, or approximations of it in their 401ks and investments.

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KoRaZee@reddit

But the number isn’t as big. Clearly bigger is better

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MzunguMjinga@reddit

That was rough decade..

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MzunguMjinga@reddit

I was coming out of college with a CS degree in 2023 when the dot.com crash was going on. It took 6 months to find a job.

Then we got hit with the Bank Collapse. This was both a blessing and curse, as home prices and interest rates fell making it an opportune time for first time homeowners. Not to forget the Homebuyer credit of $7,500.

People's pensions were collapsing (Kodak?). Car manufacturing slowed to a halt.

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icanhaztuthless@reddit

Hope you meant 2003 ;)

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MzunguMjinga@reddit

Thanks

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PapaTua@reddit

I worked in IT at a bank (which collapsed) so the Bank collapse was just a curse over here.

Up until 2008 I was doing the corporate career + young home buyer + saving 20% into retirement while still in my 20s thing. I was 100% playing by the rules and I thought I had done all the hard work of climbing from e try level to vice president.

2008 completely undid all of that and by 2010 I was bankrupt, living in my car, with zero savings. I watched my entire life get disassembled piece by piece and it was deeply traumatic.

Something broke inside and I've never recovered.

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tha_rogering@reddit

I'll bet most of those stock market gains in the 90s came from 401ks becoming the primary source of individual retirement funds.

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BadAtExisting@reddit

Into the pockets of about 900 people

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Easy-Marsupial3268@reddit

The wealth only flows up.

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Messijoes18@reddit

I remember watching 10k on TV with my music teacher and she was explaining what a big deal it was

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Searchlights@reddit

It shifted toward the wealthy

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nudave@reddit (OP)

It’s funny, because even though I was much older for that, 4k specifically stick out in my head as the big milestone I remember.

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More-read-than-eddit@reddit

I remember. Real car turning over at 100k miles” vibe

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OldArtichoke433@reddit

Same and my Vibe has 250k on the odometer 😉

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CottageGrove81@reddit

My wife used to have one of those. I wanted to get vanity plates that said "RATOR" but she said no.

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OldArtichoke433@reddit

Lol 🤣

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Door_Number_Four@reddit

Hello! Market historian and Guy Who Invests Other People’s Money here.

You are right that it was seen as a big deal.

It served as a bit of a validation of Clinton and neoliberal policies. Remember, there was a fear that Clinton’s agenda would tank the economy and the market, and that simply wasn’t true…quite the opposite as more corporate profits went to labor( for a little while)

More important was Greenspan behind the scenes. He had signaled to the market that he would keep rates low, starting a six year cycle of cheap money that ended up inflating asset prices and in part causing the tech bubble, and putting the groundwork in place for the housing bubble.

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nudave@reddit (OP)

So, um, my 401k right now. Bubble??

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OneHumanBill@reddit

I'm an AI architect. I work with it daily and deeply. I know how deep the limitations really are.

AI hype is hype. AI is real, but right now society still believes it's fairytale magic. A lot of venture money is going into AI startups and IPOs and a lot of it is vapor.

I am both an AI skeptic and a believer, on two different timescales. A lot of the plans right now aren't good, but the technology has tremendous potential for humankind once we adjust to understanding it better. That won't happen until some of the wilder dreams right now get crushed and readjusted a bit.

Long story short? Yeah, there will be a market correction. It will be big, especially if rates get lowered by Jim Walsh in the near term, which will amplify the effect. But it won't be permanent.

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Alexandratta@reddit

It's funny how folks think Agents are one single AI program and not like, many different prompts in a trench-coat.

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FoppyRETURNS@reddit

I was just trying to explain this to my mom two days ago. 😂

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Door_Number_Four@reddit

I don’t know how you are invested, so I can’t speak to your 401k.

The last 45 days in the market have seen advances led by about 33 percent of the S&P 500. This isn’t seen as a healthy stat. So I am personally taking risk off the table.

In my office I have a Wi-Tang Financial “ Diversify Your Bonds” sign….and that is my advice as always. Sell-off what has run up, invest in what’s been left for dead.

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Alexandratta@reddit

every thousand is a big deal - they don't crow when it drops back down, of course.

But the issue is that, for us in 1995, the Dow going that high was unprecedented, and marked when we started seeing the major wealth shift in the US thanks to all of Reagan's shit policies coming together.

Stocks used to rise and fall in a cadence as jobs and markets were created. The false stability created with this skyrocketing Dow jones index just meant more companies are keeping more money, not so much making more or creating better products.

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twopacktuesday@reddit

No but I remember it hitting like 6,000 during the Great Recession just as I was running out of cash from getting laid off.

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CarlSpackler22@reddit

The stock market is for rich people.

It's a poor tool for overall prosperity.

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AshDogBucket@reddit

YUP

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Deep-Interest9947@reddit

No I wasn’t paying attention to the Dow in 1995. I’m also not paying attention to it now.

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AshDogBucket@reddit

Same

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Traditional_Entry183@reddit

Same. The stock market is a scam to make the rich richer. It has no benefit to me.

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mackattacknj83@reddit

Well just like today, I had no money in 1995 so I had no idea what the Dow was doing.

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AshDogBucket@reddit

My take also.

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AshDogBucket@reddit

Who else is too poor to have ever even known what any of this meant?

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TappyMauvendaise@reddit

When will all this wealth start helping working people?

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Roland-Of-Eld-19@reddit

I don't remember anything newsworthy when it crossed 4K but there was a lot of press when it crossed 10K for the first time in April of 99

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Darkpriest667@reddit

You want to feel old? The Dow dropping 508 points caused Black Monday in 1987, that's about 23% of its total value. If the market crashed 23% today can you imagine? That would be a 10,000 point drop in the DJIA.. in one day.

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ReserveFormal3910@reddit

You want to feel old? 2008.

https://www.history.com/this-day-in-history/september-29/dow-suffers-largest-single-day-drop-great-recession

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FoppyRETURNS@reddit

Trying to tell people this was not a depression was extremely vexing

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Darkpriest667@reddit

I remember I was pumping gas when someone told me what had happened and my response was "Oh Shit"

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bigfancydelta@reddit

I was a SR in HS in '99 when it hit 10k for the first time. My economics teacher took a few minutes at the beginning of every class to check the numbers. Her flabbers were gasted to say the least, haha!

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59apache01@reddit

Even though I was young, I remember the big "market correction" of October 1987 when the Dow dropped to about 1700 and all kinds of people having meltdowns about it. As a kid, I couldn't have given less of a shit, but thinking back that had to have been scary for some to watch it drop by close to 1000 points in one day, which would have been about 40% of its value back then. Black Monday they called it.

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Dimplefrom-YA@reddit

i watch the news and see hear the wealthy say to each other. i make my investments based on that.

i made money on cannibis stocks. i made money after the first ceasefire with iran.

i pulled out the following day.

it’s not hard making it big. just watch the news and then see the stock market. always make investments based on what they have to say.

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throwawayfromPA1701@reddit

What do you think of the Autopilot app that I keep seeing advertised on Reddit?

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throwawayfromPA1701@reddit

I do remember it. My mom was the supervisor and office manager for stock brokers so sometimes this was dinner time conversation.

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Wrong-Neighborhood-2@reddit

None of it is real anyway. The market is completely speculative at this point. Not what it wasn’t speculative before but the market is being propped up by the AI bubble now. Basically our entire economy is held up by 4 companies at this point

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DonnyBoyCane@reddit

Exactly. It's soooo cute when people have flashbacks to playing the stock market game in middle school or something and try to apply rational economic criteria to today's market. It's ALL a speculative irrational casino game at this point.

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Easy-Marsupial3268@reddit

That’s because it’s just a barometer of rich people’s feelings and they are loving this war and inflation.

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DonnyBoyCane@reddit

Not to mention unprecedented levels of market manipulation and a market willing to be easily manipulated.

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Negative-Wrap95@reddit

That's totally a good thing! Nothing to worry about.

gif

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Easy-Marsupial3268@reddit

Inflation is just capitalists voluntarily raising prices.

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SmartyChance@reddit

It was a big deal in the accounting office where I worked.

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xRVAx@reddit

12x growth looks amazing,, but that's basically equivalent to 8.5% growth in investments over 31 years ..

(1.085^31)x4000 ~= 50,000

It's basic compounding interest math

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nudave@reddit (OP)

I prefer my interest continuously compounded:

ln(50k/4k)/30 ≈ .084

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nocabec@reddit

It used to be a big deal because it was reflective of the overall economy and more average people were invested.

Now (if you ask me) it's just become completely disconnected from reality. Like I believe the number as an index of all the stocks that are part of it but all the people trading those stocks are just living in some weird other universe that has connected to what the real world economy is doing.

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gravteck@reddit

One reason for the disconnection is the magnitude of liquidity in the market due to retail retirement funds, institutional investors, and the late stage securitization of everything under the sun. It's easy to be disconnected when the assets under management are so huge.

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insulinjockey@reddit

Huzzah!

The stock market is not the economy however.

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