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DOW 10000 and Lost Decade

Finally the momentum with little bit boost from Intel and JP Morgan carried DOW above 10000 2 months ahead of my prediction. I am happy about it since many of my recommendations did pretty good. However it is also a sombre reminder that DOW crossed 10000 first time in 1999 - so for buy-n-hold believers, this is really a lost decade

1999 to 2009: 10 years 0% return on stocks

So where are markets headed after reaching this milestone. Looking at positive earnings surprises, momentum would continue and may gather pace since lot of investors are still on side-lines and may be compelled to jump into market to catch remaining ride. For those who rode the markets all the way down and did not sell, must be feeling pretty good. My recommendation for those folks would be to take out some of the profits in this momentum ride. It is likely that DOW may touch 10500 before year's end and then start coming down.

Looks like there is some similarity in my recommended picks and famous hedge fund manager John Paulson (examples: BAC, RF and now CNO).

Since this is special post to celebrate DOW 10000 mark, no particular stock recommendations.

Happy Diwali !

/Shyam

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